BSE, NLC India, BDL, IRB Infra, MRPL shares may enter AMFI's midcap list; NHPC, JSW Energy may become largecaps

Zydus Lifesciences Ltd, Hero MotoCorp Ltd and NHPC Ltd are some of the midcap stocks, which may enter AMFI's largecap list in its June semi-annual categorisation rejig. BSE, NLC India, Bharat Dynamics (BDL), IRB Infrastructure IRB Infra, MRPL are among smallcap stocks that could be added to midcap list, Nuvama Institutional Equities said in its latest note.

The cut-off period began on January 1 and will end on June 30. The announcement is likely by the first week of July and that the categorisation would be effective from August 1. Nuvama said the largecap cut-off is likely around Rs 82,000 crore against Rs 67,000 crore at the end of December quarter. It sees midcap threshold at Rs 25,000 crore against Rs 22000 crore as of December 2023 levels, based on the prevailing market prices.

Bosch, NHPC and Zydus Lifesciences, which are already probable for MSCI May 2024 inclusions, could enter AMFI's largecap lists other than Hero MotoCorp, while JSW Energy also has a borderline chance of entering the largecap club. Stocks such as Marico, Berger Paints, SBI Card, SRF and Polycab India could be downgraded from largecap to midcap list.

Smallcaps such as MRPL, HUDCO, IRB Infra, BSE, Global Health, NLC India, Bharat Dynamics, Tata Investment, Nalco, Hitachi Energy and Hindustan Copper can join midcap list. Midcap shares such as ZEE Entertainment Enterprises Ltd, IIFL Finance Ltd, Piramal Enterprises, The Ramco Cement, Relaxo Footwear, SKF India, Timken India and Kansai Nerolac can be downgraded to smallcaps.

"Note that 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 for Alternative & Quantitative Research at Nuvama.

Jana Small Finance Bank, GPT Healthcare, Vibhor Steel, Gopal Snacks, Rashi Peripheral and Mukka Protein could b some of the new entrants to the smallcap category.

As per the circular released by Sebi in October 2017, 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. Sebi has also stipulated that AMFI should prepare the list of stocks in this regard. Accordingly, AMFI in consultation with Sebi and stock exchanges, prepares the list of stocks with categorisation based on the market capitalisation provided by BSE NSE and MSEI.