Zydus Life, NHPC, JSW Energy Could Enter Large-Cap Universe In AMFI Rejig
The announcement by the Association of Mutual Funds of India is expected in the first week of July and will be effective from Aug. 1.
Zydus Lifesciences Ltd., Hero Motocorp Ltd., NHPC Ltd., Bosch Ltd. and JSW Energy Ltd. are among probable large-cap entrants for the upcoming AMFI Semi-Annual Categorisation.
The cut-off period began on Jan. 1 and ends on June 30. The announcement by the Association of Mutual Funds of India is expected in the first week of July and will be effective from Aug. 1.
Nuvama Alternative Research has analysed potential changes for the second half of calendar year 2024.
Potential Large-Cap Entrants:
Zydus Life, Hero MotoCorp, NHPC, Bosch and JSW Energy
Potential Mid-Cap Entrants:
Mangalore Refinery and Petrochemicals Ltd., Housing and Urban Development Corp., IRB Infrastructure Developers Ltd., Global Health Ltd., BSE Ltd., NLC India Ltd., Bharat Dynamics Ltd., Tata Investment Corp., National Aluminium Co, Hitachi Energy India Ltd., Hindustan Copper Ltd.
Stocks which could move from large cap to midcap include Marico Industries Ltd., Berger Paints India Ltd., SBI Cards and Payment Services Pvt., SRF Ltd., and Polycab India Ltd.
"The change in categorisation doesn’t lead to incremental inflows or outflow. The active mutual fund managers keep an eye on the list while taking fresh/modifying position in stocks in different category of schemes," said Abhilash Pagaria, head, Nuvama Alternative & Quantitative Research.
At current average market-cap levels, Nuvama anticipates the large-cap cut-off to be approximately around Rs 82,000 crore (versus Rs 67,000 crore as of December 2023) and the mid-cap threshold to hover around Rs 25,000 crore (versus Rs 22,000 crore as of December 2023).
Zydus Life, NHPC and Bosch are also Nuvama Alternative high conviction entrants for the MSCI May 2024 Rejig.
Listed stocks must be strictly categorised into baskets with a well-defined classification of large-cap, mid-cap and small-cap stocks, according to Securities and Exchange Board of India. This is to ensure uniformity in the investment universe for equity mutual fund schemes.
The SEBI circular on Categorization and Rationalization of Mutual Fund Schemes defines large, mid, and small-cap stocks based on the six-month average of full market cap. The reviewed is done on half yearly basis by AMFI.
