Analysts at Nuvama Alternative & Quantitative Research have done an early analysis for change in Association of Mutual Funds in India (AMFI) market cap categorization for H2 CY23. AMFI will release the official list in first week of July 2023 and the fresh list will be valid for Aug 2023 to Jan 2024 period.
Potential largecap entrants, as per Nuvama, are Jindal Steel and Power (JSPL), Punjab National Bank (PNB), Canara Bank, IDBI Bank, Tube Investments, Indian Overseas whereas borderline names are Yes Bank, TVS Motors, Union Bank, Shriram Finance.
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Stocks which can move from large cap to midcap are Tata Elxsi, Nykaa (FSN E-Commerce), JSW Energy, Page Industries, Indus Towers, Zomato whereas borderline names are Trent, Macrotech Developers (Lodha), Info Edge, PI Industries, as per the brokerage’s estimates.
Meanwhile, stocks which can move from midcap to smallcap are Piramal Pharma, Tata Teleservice, Nippon Life, Fine Organic Inds, whereas borderline names are Clean Science, Gillette India, Blue Dart Express, and Trident.
As per capital market regulator Securities and Exchange Board of India (SEBI), the listed stocks must be strictly categorized into baskets with a well-defined classification of largecap, midcap and smallcap stocks. This is to ensure uniformity in respect of the investment universe for equity mutual fund schemes.
Further, SEBI has also stipulated that Association of Mutual Funds of India (AMFI) shall prepare the list of stocks in this regard. Accordingly, AMFI in consultation with SEBI and stock exchanges, prepares the list of stocks with categorization based on the market capitalization provided by BSE, NSE and MSEI.
