BHEL, JSW Energy shares may enter AMFI's largecap category; HUDCO, Cochin Shipyard may become midcap stocks

Nuvama in its latest note on probable chances to AMFI expects at least seven midcap stocks to get added to the largecap category in the forthcoming June rejig. They included JSW Energy Ltd, BHEL, Hero MotoCorp, Bosch, NHPC and Samvardhana Motherson International Ltd.

Largecap stocks such as Berger Paints, Marico, SBI Card, SRF, Polycab India, ICICI Prudential Life Insurance Company Ltd and ICICI Lombard are expected to be shifted to the midcap category.

Nuvama said based on the prevailing average market-cap levels, it expects the large-cap cut-off to be approximately Rs 82,000 crore compared with Rs 67,000 crore as of December 2023. It sees the midcap threshold at Rs 27,000 crore compared with Rs 22,000 crore as of Dec 2023).

Smallcaps such as HUDCO, MRPL, BSE, Bharat Dynamics, NLC India, Hindustan Copper, Godrej Industries, Nalco and Cochin Shipyard could enter midcap category, Nuvama said.

ZEE Entertainment Enterprises, IIFL Finance, Devyani International, Piramal Enterprises, The Ramco Cement and Kansai Nerolac are a few midcap stocks that may get smallcap tag in forthcoming AMFI rejig.

New entries to the smallcap category may include Jana Small Finance Bank, Gopal Snacks, Rashi Peripheral, GPT Healthcare, Mukka Proteins and Vibhor Steel among others.

Unlike index inclusions, the change in AMFI categorisation does not lead to incremental inflows or outflow. But active mutual fund managers keep an eye on the list while taking fresh positions in stocks in different category of schemes.

Sebi had in October 2017 said the listed stocks must be strictly categorised into baskets with a well-defined classification of large cap, midcap and small cap stocks. This was to ensure uniformity in respect of the investment universe for equity mutual fund schemes. AMFI prepares the list of stocks in this regard in consultation with Sebi and stock exchanges, with categorisation based on the market capitalisation provided by BSE, NSE and MSEI.