Jan 5, 2023
By: Bhakti MakwanaThe Association of Mutual Funds of India (AMFI) has released a list of stocks, categorizing them into large, mid and small cap based on the six months average market capitalization provided by BSE, NSE and MSEI.
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This classification is important for the mutual fund industry since MFs are required to allocate a certain percentage of money into these categories of stocks. For example, a large cap scheme should invest at least 35 percent of its assets in large cap companies. This list is valid from February 2023 to July 2023.
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One 97 Communications (Paytm), Mphasis, Piramal Enterprises, Gland Pharma, Bandhan Bank, and Muthoot Finance.
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Tanla Platforms, Chambal Fertilisers and Chemical, IEX, National Aluminum, Godrej Industries, The New India Assurance, ICICI Securities and Aavas Financiers among stocks downgraded to smallcap from midcap.
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Global Health (Medanta), Bikaji Foods, Archean Chemical Industries, KFin Tech, Kaynes Technology, Harsha Engineers, Sula Vineyards, DCX Systems, Inox Green, Landmark Cars among other stocks enter the smallcap category.
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The demerged entity Piramal Pharma, which got listed as a separate entity after demerging from Piramal Enterprises in October 2022, made its entry in the midcap category.
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Varun Beverages, ABB India, Page Industries, Tata Elxsi, Bosch, Trent and PI Industries have been upgraded to large cap from midcap.
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Timken India, Metro Brands, Blue Dart Express, Fine Organic, UCO Bank, ZF Commercial Vehicle Control Systems, Apollo Tyres and Kpit Technologies have been upgraded to midcap from smallcap.
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According to Nuvama Research, an upward recategorisation does not necessarily mean inflows but it does lift stocks. The upgraded list helps equity fund managers realign their portfolios by adding and removing stocks according to the stock category and fundamentals.
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