The Indian stock market has gained prominence on the world stage, with current contribution to world m-cap at 3.2 per cent, up 70 basis points from long-term average of 2.5 per cent. While India figures in the top-10 equity markets, at $3.2 trillion it is still behind US, China, Hong Kong and Japan.

From a valuation perpsective, the m-cap to gross domestic product (GDP) metric indicates India is back at 100 per cent levels, after slipping to 56 per cent in FY20. After a hiccup in early part of CY22, Indian stocks have regained form, with Foreign Institutional Investors (FII) turning net buyers after nine long months. Interestingly, smallcap stocks that are often a high-risk and high-reward game have belied expectations in the last 10 year period. It’s actually midcaps and largecaps that have done much better. Here is a closer look.

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