Digital Platforms, CDMO Plays dominate the Mid-Cap Index in October 2026

HOW MID-CAPS PERFORMED IN OCTOBER 2026?

Mid-caps have been under pressure after they corrected from the 60,000 levels. It still continues to outperform large caps. Mid-Cap 100 index was down -3.42% MOM and down -4.65% yoy. Mid-cap 100 index is much closer to its yearly highs, but what really stands out about the mid-cap index is the striking outperformance of 2 stories.

Mid-cap story in October was dominated by digital platforms and CDMO plays, while IT and financials also participated. Out of 100 stocks, only 22 stocks gave positive returns over 1-month, but 36 stocks gave positive returns over 1-year. There were 21 companies bouncing over 40% from yearly lows and 14 companies less than 10% from their highs.

Data Source: NSE

Note: All the percentage changes shown above are point-to-point returns and have not been annualized. The combined rank score is just a theoretical number for representation purpose.

WHY MOMENTUM + STRUCTURAL RETURNS FOR MID-CAPS?

• Momentum captures short-term trends and stories much better. Momentum is represented in this case by 1-month returns and swing from the 52-week highs.

• Structural returns talk about longer-term sustainable trends from an investment perspective. It combines 1-year returns and bounce from the 52-week lows.

• The Nifty Mid-cap 100 companies were ranked on each of the above 4 parameters, and then a combined rank was taken by averaging these four ranks.

• In the case of IPOs with less than 1-year listing history in the mid-cap index, the 1-year returns are calculated by taking the IPO issue price as the base price.

WHAT WE READ FROM THE MID-CAP RANKINGS FOR OCTOBER 2026?

The mid-cap index gave a rather divergent performance in October 2026.

• In the Top-20 mid-cap stocks by combined rank; Laurus Labs gave best 1-month return of 21.49%. Out of these 20 winners, 11 gave positive returns over 1 month.

• In the Top-20 stocks list, Laurus Labs and Meesho gave best 1-year returns of 147.9% and 100.5%. Each of the top-20 mid-cap stocks gave positive 1-year returns.

• The most prominent sector in the top-20 mid-caps by combined rankings was Digital Platforms with 5 stocks; Nykaa, Lenskart, Groww, Meesho, and Paytm. The digital platforms have now started seeing reduction in their cash burn, better reach, and much better economics as these platforms move towards positive EBITDA.

• Healthcare stocks gained on the back of CDMO prospects, and rapid growth in profits of CDMO players. Laurus Labs, Aurobindo, Mankind, and Glenmark figured in the top-20 list. CDMO had short-term momentum and long-term structure in its favour.

• The other stocks in the top-20 were a rather eclectic mix. Coforge and Persistent were mid-cap IT stocks playing on the global contra-AI bet. Select FMCG players with favourable growth like Marico and Radico Khaitan were in the list ahead of festive season. Banks were present, but mid-caps are underplaying the BFSI space.

• The stocks at the bottom were specific stories. Swiggy continued to struggle with widening losses. Yes Bank has come under pressure after the AT-1 bonds ruling by the Supreme Court. Defence stocks are under pressure on execution concerns. Financials with insurance dependence saw pressure in October on IRDAI proposal.

Broadly, 4 stories were seen in October. Better economics is driving digital platforms. CDMO players are gaining from big order flows and profit growth. Mid-cap IT is seeing better order books and gaining from the contra-AI trade. Of course, a number of customer facing sectors are also in focus ahead of the festive season!