Top 10 Smallcap Stocks Tumble Up to 20% in 2026: Is Your Portfolio at Risk?
After a challenging 2025, where the Nifty Smallcap 100 index fell nearly 6%, 2026 is shaping up to be another tough year for smallcap stocks. The index is already down about 2%, with several stocks sliding as much as 20% in just the first few trading sessions. This article highlights the top 10 stocks that have led the sell-off in the index at the start of the new year.
Godfrey Phillips India, a leading cigarette manufacturer, has emerged as the worst performer, plunging 20% amid heightened regulatory and policy scrutiny. The company faces a significant tax hike, with cigarette taxes expected to rise by 38% to 50%, depending on the cigarette length. This translates into a weighted-average tax hike of around 40% to 42%.
Schneider Electric Infrastructure has also seen a significant drop, with the stock declining 14% so far in 2026. The company, which operates in the energy technology space, offers solutions across electrification, automation, and digitalization for homes, buildings, data centers, infrastructure, and industries, with a focus on energy management.
Ashoka Buildcon, a major player in India’s infrastructure sector, has seen its shares fall 12.5% in 2026. The company is known for its strong presence in highway development through EPC (Engineering, Procurement, and Construction) and BOT (Build-Operate-Transfer) models.
Rallis India, a Tata Group company, has witnessed a 11.5% drop in its stock price in 2026. Rallis is a leading Indian agrochemicals firm, supplying farmers with crop protection products such as pesticides and fungicides, along with crop nutrition solutions including speciality nutrients and bio-stimulants.
Housing Development and Infrastructure has seen its stock decline by 11% in 2026, and it is down about 26% over the past six months. The company is engaged in developing residential properties and commercial complexes.
Indo Count Industries, a home textiles exporter, has seen its shares slip 10.22% in 2026. The decline has been driven largely by trade tariff concerns after US President Donald Trump warned of 500% tariffs on countries purchasing Russian oil, including India. Indo Count is a leading manufacturer and exporter of bedding products such as bed sheets, quilts, and decorative pillows.
Adani Energy Solutions, a Gautam Adani Group company, is down 10% so far in 2026. Despite the stock decline, the company has maintained strong collection efficiency and system availability. The transmission business has an under-construction order book worth Rs 77,787 crore.
Swan Corp, a diversified conglomerate with operations spanning shipbuilding, heavy fabrication, textiles, real estate, oil and gas, and other sectors, has seen its stock fall 10.1% in 2026.
Kaveri Seed Company, a leading seed company, has also seen its stock decline in 2026. The company is known for its high-quality seeds and has a strong presence in the agricultural sector.
These significant declines in smallcap stocks highlight the challenges faced by these companies and the potential risks for investors. It is crucial for investors to stay informed and make well-informed decisions to protect their portfolios in these volatile times.
