While Everyone is Watching the Big Stocks, These Mid-Caps Are Quietly Gaining Ground

Introduction

In my previous post, I wrote about how the Russia-Ukraine war, US tariffs on India, and the US-India trade deal created a chain of consequences for our stock market.

I focused on the obvious, well-known names. I talked about the large-cap refiners, the big IT companies, the household-name pharma stocks.

But the real opportunity in most of these geopolitical shifts often hides one layer below that.

The large-cap stocks get all the news coverage and attention. Most analysts and investors are already watching them. I do not think, even in such times, there is much margin of safety left in most such names. So I try to look elsewhere.

The mid-cap and small-cap companies that sit in the same sectors, doing the same work but at a smaller scale, often get noticed much later.

By the time the mainstream starts to focus on them, a significant part of the move is already done.

This gap between visibility and reality is where clever investors can build wealth.

So in this post, I want to walk you through five companies that I think deserve serious attention in the context of everything thats been happening around us. These are not just momentum plays. Yes, they have slipped a bit in the recent price rout, but they are also high quality companies. They are businesses with a genuine structural reason to benefit from the current geopolitical setup.

I want to explain my reason so you can form your own informed view. Please remember that these are no

The Theme That Connects All Five Names

Before I get into individual companies, let’s understand the connecting thread.

The US-India trade deal and the EU-India free trade agreement together are creating something quite specific for Indian exporters. India has a relative tariff advantage, and that is helping us.

• India’s exports to the US now face 18% tariffs.
• China faces 27% or higher in many categories.
• Vietnam faces around 16-20%.
• Bangladesh is at about 20%.

So in multiple product categories, Indian exporters are now competitively placed against the countries that have been winning global orders from us.

Additionally, the EU-India FTA eliminates duties on nearly 99.5% of Indian goods entering the EU.

• Textiles,
• Pharma APIs,
• Specialty chemicals, and
• Garments.

All of these go to Europe at zero duty now.

For companies that were previously paying 6-12% tariff on EU-bound goods, this is a direct margin improvement.

The deal is already signed, and the tariff removal is scheduled.

The question now is rhat which Indian companies have genuine capacity, quality, and customer relationships to actually capture the new export opportunity?

Let me share with you a few names based on my understanding (just for academic purposes). They are no investment advice.

Five Companies Worth Your Serious Attention

1. Laurus Labs

It is a CDMO transition in progress.

Laurus Labs is a Hyderabad-based pharma company that most people know as an API manufacturer with strong exposure to HIV medicines.

But this company is now transitioning into the CDMO (contract development and manufacturing) business.

It will manufacture complex drugs and intermediates for global pharmaceutical companies under long-term supply contracts.

This will benefit the company in the current context for two reasons.

• First, the US Biosecure Act restricts American pharma companies from sourcing from certain Chinese biotech firms. That creates a genuine demand for alternative CDMO partners. India with the highest number of US FDA-approved plants outside the US, seems like a natural beneficiary.
• Second, the EU-India FTA reduces the regulatory and cost friction for Laurus to grow its European revenues.

Laurus already has around 33% of its revenues coming from the EU. That percentage could grow meaningfully as the FTA reduces approval timelines and compliance costs for its formulations in European markets.

The company is also a direct beneficiary of India’s Biopharma Shakti scheme. It provides government support for building CDMO infrastructure.

2. Gland Pharma

This is an injectable CDMO with a European footprint.

Gland Pharma deserves attention. It is one of the world’s largest injectable CDMO companies. It manufactures injectable medicines on a contract basis for large global pharma firms. Injectables are complex to manufacture and very expensive to get approved. This is a very highly regulated space for drug manufacturers.

For a company like Gland Pharma, this complexity becomes its moat.

The company made a significant move when it acquired Cenexi, a French pharmaceutical CDMO, a couple of years ago. That acquisition gave Gland Pharma a direct manufacturing presence in Europe. Which means, the EU-India FTA is not just about exporting from India to Europe for Gland. It is about being a European manufacturer with Indian cost advantages.

That is a different and stronger competitive position than most pure-play Indian exporters have.

Gland is also expanding its injectable capacity. They are entering into pen and cartridge formats used in diabetes drugs. This is also one of the fastest-growing drug categories globally.

Around 20% of its revenues already come from the EU. With Cenexi integrated, that share is set to grow bigger.

3. Anupam Rasayan

It plays in the Specialty Chemicals theme that is set to become a big global player

Anupam Rasayan is a specialty chemical company based in Gujarat. Its business involves the custom synthesis of complex chemicals for global clients in pharma, agrochemicals, pigments, and polymer additives.

The business model is different from that of a commodity chemical company. Anupam makes specific, difficult-to-replicate molecules for particular clients under long-term contracts. That expertise gives stickiness to the company with respect to its customers. This kind of advantage is very valuable.

In December 2025, Anupam made a strategic acquisition that significantly changed its profile.

It acquired Jayhawk Fine Chemicals, a US-based specialty chemical manufacturer in Kansas. This gives Anupam a manufacturing base inside the US. It is a meaningful strategic move in an environment where American companies are actively looking to reduce their dependence on Chinese supply chains.

Having a local US facility while also having low-cost Indian manufacturing gives Anupam a two-pronged advantage.

If export volumes improve as the trade deals take effect, Anupam has significant operating leverage. It means margins can expand sharply even on moderate revenue growth.

4. Gokaldas Exports

Gokaldas Exports is India’s largest apparel exporter by revenue.

It manufactures garments for major global fashion and sportswear brands. The company has historically been more US-focused. But now, it has been deliberately expanding its European client base and has been redirecting its capital expenditure specifically toward European expansion in 2026-27.

With the EU-India FTA eliminating tariffs on Indian apparel (previously it was about 12%), Gokaldas becomes more cost-competitive against Turkish and Pakistani manufacturers. These two countries have historically dominated the European fast-fashion supply chain.

The company has also been acquiring manufacturing capacity in lower-cost geographies, which helps it manage margin pressures without compromising on delivery quality.

Around 33% of Gokaldas’s revenues come from the EU.

As tariff removal makes Indian garments more price-competitive in Europe, this company is positioned well to benefit directly and relatively.

5. KPR Mill

KPR Mill is a vertically integrated textile company.

It does everything from spinning cotton yarn to manufacturing and exporting finished garments.

This vertical integration is a cost and quality advantage over companies that depend on external suppliers for intermediate inputs.

About 24% of KPR’s revenues come from Europe.

• The company is building a new facility in Odisha targeting significantly higher production capacity.
• It is also investing in advanced spinning technology that reduces labour dependence and improves consistency.

Both of the above qualities are something that European buyers value highly.

European retail brands are increasingly focused on ethical sourcing and supply chain transparency. KPR’s scale and integration give it the kind of compliance infrastructure that small garment makers cannot replicate.

The EU-India FTA’s tariff removal directly improves KPR’s price competitiveness in the EU. Combined with capacity expansion, the setup for this company over a three-to-five year horizon is genuinely compelling.

Conclusion

Each of the above five companies has been building the operational capability to actually deliver to their customer.

The trade deals further improve the economics for them. The businesses themselves were already moving in the right direction.

A combination of structural readiness plus policy support is what can give these companies sustainable long-term returns. Neither factor alone is sufficient.

• A company with a great policy tailwind but weak execution will disappoint.
• A great business with no external catalysts can grow very slowly.

But when both come together, you often get compounding that surprises even careful investors.

I am not saying any of these will go up in a straight line; they will not. Some of them may experience some short term pain as well. But three to five years out, the logic behind each of them will help them to compound.

That is the kind of foundation I like to see in my companies.

How do I research?

• I look at the balance sheets.
• Check the debt levels,
• Understand the promoter quality and assess the valuations before I take any position.

Disclaimer: This post is for educational purposes only and does not constitute investment advice or a buy/sell recommendation for any security mentioned.