The stock market’s obsession with big names—Reliance, TCS, Infosys—is like cheering for Goliath while ignoring David’s slingshot. But between 2018 and 2024, India’s small and mid-sized companies quietly staged a revolution. These firms, often dismissed as too risky or too niche, delivered returns that dwarfed their blue-chip peers. Their stories aren’t just about stock prices—they’re about how obscurity, patience, and scale combine to create wealth.
Between 2018 and 2024, India’s BSE and NSE saw a parade of small and mid-sized companies delivering returns so staggering they’d make even seasoned investors blush
My family member suggested to review KSOLVES, 87x in 5 years
When you look at what they do, you may dismiss them casually as a bodyshop
A body shop typically supplies IT manpower to companies without focusing on innovation, proprietary products, or tailored solutions. These firms act as intermediaries between businesses and freelance IT professionals or temporary staff
However delving deeper they were much more
Software Development: They create applications and tools tailored to their clients' needs. Think of them as the team behind the tech that helps companies solve specific problems.
Big Data: They help businesses analyze large amounts of information to make better decisions. For example, finding patterns in customer data to improve sales.
Salesforce Solutions: They specialize in Salesforce (a popular customer relationship management software) to help companies manage their sales, customer interactions, and services more effectively.
Odoo Apps: They create apps on Odoo, a platform for managing everything from inventory to human resources, making businesses run more smoothly.
AI & Machine Learning: They help companies automate tasks and predict outcomes using artificial intelligence.
Any smart investor who would have cared to dug deep would have been handsomely rewarded
Why Small Companies Excel
Market Inefficiency
Small caps often fly under the radar of institutional investors. This creates pricing inefficiencies, allowing savvy retail investors to pick up gems at bargain valuations.Growth Potential
A small company with a ₹10 crore revenue base can grow at 30-40% annually for many years , a feat nearly impossible for larger companies unless you are Google.Focused Leadership
The founders of small companies are usually deeply involved in day-to-day operations, ensuring sharper focus and accountability.
They have issues too!
Volatility
Small-cap stocks can swing wildly. A 20% drop in a week isn’t uncommon, testing the patience of even seasoned investors.Liquidity Risks
Lower trading volumes in small-cap stocks can make it difficult to enter or exit positions without impacting prices.Corporate Governance Issues
Some smaller firms may lack transparency, leading to surprises that destroy value.
Case in Point:
PC Jeweller (BSE: 534809, NSE: PCJEWELLER)
Once a promising small-cap in 2018, allegations of financial irregularities led to a catastrophic decline. Its stock plummeted from ₹600 in 2018 to under ₹20 in 2024.
However I am in camp that we will discover dozens of Ksolves in India in future, my philosophy is simple
Investing in small companies is like gardening: most seeds won’t sprout, but a few grow into banyan trees. The key is to plant widely, water patiently, and prune ruthlessly.
Because sometimes, the mightiest oaks grow from the tiniest acorns.
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