The first six months of 2019 were exciting for equity markets as benchmark indices climbed new peaks during this period. Sensex hit a record high at 40,312 and Nifty surged to its life-high of 12,103 earlier in June.

In the first half of the current year, investors’ wealth grew around 6 lakh crore. The average market capitalisation of the BSE-listed companies grew from Rs 144.48 lakh crore on December 31, 2018 to Rs 150.47 lakh crore on June 21, 2019. Sensex rose over 3,000 points or 8.67 percent while Nifty rose nearly 8 percent from in the same period.

After suffering double-digit cuts in 2018, the S&P BSE Midcap index fell 5.2 percent while the S&P BSE Smallcap index was down 4.2 percent in the first six months in 2019.

But, some stocks outperformed the benchmark and broader indices and turned out to be wealth creators for their investors. More than 100 BSE500 stocks outperformed the benchmark in the first half of 2019.

There are 123 BSE500 stocks that rose 10-50 percent, of which 24 surged over 30 percent in the January-June period in 2019. They include DCB Bank, UPL, Bajaj Finance, PI Industries, JustDial, SRF, Manappuram Finance, SpiceJet, InterGlobe Aviation, Orient Cement and Titan Company, among others.

Table: 24 BSE500 stocks that rose over 30 percent in the January-June period in 2019. Returns are as of June 21, 2019.

Now, the question in front of investors is should they remain invested or book profits in these companies?.

“Most of the stocks that are moving up swiftly and sustaining at higher levels are companies that are delivering strong earnings growth and where earnings visibility is very high,” Rusmik Oza, Head of Fundamentals, Kotak Securities told Moneycontrol.

“In certain cases, companies are able to increase market share due to problems being faced by competitors; for example SpiceJet and InterGlobe in Aviation and Bajaj Finance in NBFC sector,” he said. Oza further added that in some cases the business cycle is improving and hence the business is picking up.

“It makes sense to accumulate beaten down companies where the downturn is temporary and could pick up after few months (i.e., automobiles and larger NBFCs,” he added.

Smaller companies, big returns?

Stocks of 31 companies that have a market cap of less than Rs 100 crore rose 100-500 percent in the first half of 2019. They include 7NR Retail, Seamec, CHD Chemicals, Indo US Bio-Tech and Bhilwara Spinners, among others.

Despite these names giving stellar returns, the year 2019 has not been an exciting one for investors who invested heavily in the small & midcap space.

The smart money was diverted from the stocks in the broader market towards a select few companies having the right mix of growth, quality management, earnings visibility, and business moat.

According to experts, retail investors should review their portfolio as some of the names could be trading at overbought levels.

“The narrow market has resulted in select outperforming stocks getting more expensive as more money was invested in them. Investors should review their portfolio and reweight it if some performing stocks have gained abnormal weights,” Deepak Jasani, Head - retail research, HDFC securities told Moneycontrol.

“They could also keep a trailing stop loss below which they may look at the stock closely for any changes in their fortunes and take a decision to exit partially or completely,” he said.

: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.