Best Performing Mid & Small-Cap Stocks in 2025 So Far
Best Performing Mid & Small-Cap Stocks in 2025 So Far
The year 2025 has been an exciting one for Indian equity investors, especially in the mid-cap and small-cap segments. These stocks have delivered stellar returns, often outpacing the large-cap indices like Nifty 50 and Sensex.
Thank you for reading this post, don't forget to subscribe!Driven by robust earnings growth, sectoral rotation, and strong domestic participation, the mid- and small-cap rally has emerged as one of the standout stories of the year.
In this blog, we’ll explore the key drivers behind this rally, highlight the best-performing stocks so far, and discuss what investors should watch in the coming months.
Why Mid & Small-Caps Are Outperforming in 2025
1. Strong Domestic Liquidity
Mutual funds and retail investors continue to pour money into small and mid-cap schemes, driving demand and boosting valuations.
2. Earnings Growth Momentum
Many mid-cap companies are posting faster earnings recovery compared to large caps, supported by operating leverage and efficiency gains.
3. Government Capex Push
The government’s focus on infrastructure, manufacturing, and defense has benefited mid-cap and small-cap companies in capital goods, engineering, and allied sectors.
4. Broader Market Participation
With the economy expanding beyond a few large sectors, investors are discovering opportunities in niche industries like renewables, chemicals, and defense.
Top Midcap Companies in 2025
1. Apollo Micro Systems (AMS)
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Founded: 1997 | Headquarters: Hyderabad
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About: Provider of high-performance electronic, electromechanical, and engineering design solutions for defense, aerospace, space, and industrial applications.
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Highlights: Secured significant defense contracts, including DRDO deals, and entered a technology transfer agreement.
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YTD Return: 237.29%
2. AXISCADES Technologies Ltd
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Founded: 1990 | Headquarters: Bengaluru
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About: Engineering solutions company providing product design, embedded electronics, avionics, systems engineering, and lifecycle support globally.
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Highlights: Focused on high-reliability defense systems including radar, sonar, drones, and electronic warfare systems.
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YTD Return: 206.68%
3. CarTrade Tech Ltd
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Founded: 2000 | Headquarters: Navi Mumbai
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About: Multi-channel automotive platform facilitating buying, selling, and financing of vehicles. Operates CarWale, BikeWale, Shriram Automall, and OLX India.
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Highlights: Strong AI-driven solutions, robust financial growth, and continued leadership in the automotive sector.
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YTD Return: 175.03%
4. Cupid Ltd
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Founded: 1993 | Headquarters: Nashik, Maharashtra
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About: Manufacturer of condoms, lubricants, personal care products, and in vitro diagnostic kits.
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Highlights: Expanded into the Middle East and reported a nearly 100% profit increase in Q2 FY2025.
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YTD Return: 169.69%
5. Gabriel India Ltd
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Founded: 1961 | Part of: ANAND Group
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About: Manufacturer of ride control products, including shock absorbers and dampers for vehicles and railways.
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Highlights: Strategic reorganization, expansion into European bicycle market, and acquisition from Marelli Motherson Auto Suspension.
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YTD Return: 165.58%
Top Smallcap Companies in 2025
1. Sumeet Industries Ltd
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Founded: 1988 | Headquarters: Surat, Gujarat
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About: Manufacturer and exporter of polyester-based yarns and chips for textile and industrial applications.
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Highlights: Strong international presence in US, China, Egypt, and Europe.
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YTD Return: 4176.40%
2. Tera Software Ltd
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Founded: 1994 | Headquarters: Hyderabad
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About: IT solutions provider for integrated projects, including smart cities.
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Highlights: Major BharatNet Phase-3 contracts worth ₹1,901 crore. FY2025 revenue: ₹108 crore, net profit: ₹33.56 crore.
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YTD Return: 468.92%
3. NACL Industries Ltd
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Founded: 1993 | Headquarters: Hyderabad
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About: Agrochemical company producing insecticides, fungicides, herbicides, and plant growth regulators.
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Highlights: Acquired by Coromandel International (53% stake), strong operational recovery in Q1 FY2025-26.
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YTD Return: 276.75%
4. Indo Thai Securities Ltd
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Founded: 1995 | Headquarters: Indore
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About: Full-service stock and commodity brokerage firm with equities, derivatives, commodities, mutual funds, and real estate services.
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Highlights: 1:10 stock split in July 2025, strong market presence across 60 locations.
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YTD Return: 275.77%
5. Aarvee Denims & Exports Ltd (Varvee Global Ltd)
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Founded: 1988 | Headquarters: Ahmedabad
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About: Textile manufacturer specializing in denim and non-denim fabrics; also operates in renewable energy.
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Highlights: Fully integrated manufacturing, strong turnaround in FY2025 with revenue ₹42.45 crore and net profit ₹19 crore.
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YTD Return: 236.55%
What Investors Should Watch Out For
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Valuations Getting Stretched: Some mid and small-cap stocks trade at premium valuations, increasing correction risk.
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Earnings Consistency: Sustained profitability is key for continued growth.
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Liquidity Risk: Small-cap stocks can experience sharp volatility during FII outflows or redemption phases.
Investment Takeaways
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Focus on fundamentally strong companies with sustainable earnings visibility.
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Avoid chasing momentum; invest during corrections or through Systematic Investment Plans (SIPs).
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Diversify across sectors—avoid concentrating bets on a single theme.
Final Thoughts
Mid and small-cap stocks have been the market’s shining stars in 2025, creating substantial wealth for investors. However, the rally calls for prudence.
By focusing on quality, monitoring valuations, and keeping a long-term horizon, investors can navigate risks while capitalizing on India’s growth story. The mid and small-cap space is poised to continue offering exciting opportunities for those willing to do their homework.
Related Blogs:
Understanding Market Capitalization: Small-Cap vs Mid-Cap vs Large-Cap
Outlook 2023: Mid, smallcaps could outperform large-caps
Understanding Market Capitalization in the Stock Market
Diversification Strategies for Small-Cap Bank Investments in India
Best Small-Cap Bank Stocks in India for 2025
Small Cap Companies in India : How to Choose the Best Ones
Disclaimer: This blog post is intended for informational purposes only and should not be considered financial advice. The financial data presented is subject to change over time, and the securities mentioned are examples only and do not constitute investment recommendations. Always conduct thorough research and consult with a qualified financial advisor before making any investment decisions.