These Stocks Are New Large, Mid And Small Caps After AMFI Rejig
Varun Beverages, Page Industries and Tata Elxsi are among the stocks that will move into the large-cap category.
Varun Beverages Ltd., Page Industries Ltd., and Tata Elxsi Ltd. are among the stocks that will move into the large-cap category for mutual funds after latest reclassification based on market capitalisation.
ABB India Ltd., Bosch Ltd., Trent Ltd. and PI Industries Ltd. also moved up the ranks and are now classified as large caps by the Association of Mutual Funds in India. The changes will become the benchmark for equity-oriented schemes in the first half of 2023.
This list is compiled biannually based on the average market capitalisation over a six-month period. The first 100 stocks by market capitalisation are designated as large cap, the next 150 are labelled as mid caps, and the rest are called small caps.
Among the stocks relegated to the mid-cap basket are Muthoot Finance Ltd., One97 Communications Ltd., Bandhan Bank Ltd., Mphasis Ltd., Gland Pharma Ltd. and Piramal Enterprises Ltd.
Stocks that move from the small- to mid-cap category include Timken India Ltd., Metro Brands Ltd., Blue Dart Express Ltd., Fine Organic Industries Ltd., UCO Bank Ltd., ZF Commercial Vehicle Control Systems Ltd., Apollo Tyres Ltd. and KPIT Technologies Ltd.
A new entrant to the mid-cap basket was Piramal Pharma Ltd., which was demerged from Piramal Enterprises in 2022.
Moving from the mid-cap to small-cap category are AAVAS Financiers Ltd., ICICI Securities Ltd., The New India Assurance Co., Godrej Industries Ltd., National Aluminium Co., Indian Energy Exchange Ltd., Chambal Fertilisers & Chemicals Ltd. and Tanla Platforms Ltd.
A number of new entrants to the stock market were designated as small caps.
Actively managed equity mutual fund schemes are governed by thresholds based on market capitalisation that are stipulated by the Securities and Exchange Board of India. A large-cap fund must have 80% of its assets under management in large-cap. Mid- and and small-cap schemes must have 65% of assets under management in respective category of stocks. Multi-cap funds must have at least 25% each in large-, mid-, and small-cap stocks.
While the reclassification of a stock could lead to fresh inflows for actively managed equity schemes, this is not a foregone conclusion as it depends on the discretion of fund managers.