Correction in small, midcaps: No need for statement, says Buch

Sebi Chairperson Madhabi Puri Buch on Friday said there is “no need” for the capital markets regulator to comment on the recent steep correction in small and midcap stocks. Drawing from her statement in March last year on the high valuations in the same stocks, Buch said Sebi had flagged its concerns on the high valuations when it saw a need for it.

“On midcaps and small caps, I think that at a point in time when the regulator felt the need to make a statement about it, the statement was made. Today, the regulator feels no need to make an additional statement,” she said speaking at an AMFI event here.

It can be noted that the small and midcap stocks are in bear territory lately, with some scrips declining by over 20 per cent in quick succession.

In March 2024, in what is a rare comment from the regulator, Buch had flagged concerns about the high valuations in the two segments.

“There are pockets of froth in the market. Some people call it a bubble, some may call it froth. It may not be appropriate to allow that froth to keep building,” she had said.

Meanwhile, Buch also said that the regulator has no intention of making it compulsory for fund houses to launch the recently introduced Rs 250 systematic investment plan.