The stock market has witnessed a lot of volatility over the past one year. Global uncertainties weighed heavy on the market earlier this year, but it bounced back following the passage of key reforms, a healthy monsoon and strong inflows of foreign investments.
However, the healthy uptick in stock prices has taken market valuations pretty high, even as corporate earnings growth has been moderate at best. The appetite for mid- and small-cap stocks, in particular, has been very high, leading to a surge in valuations in certain pockets. Equity fund managers have had to dig deep to find rewarding stocks.