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Rail Vikas Nigam Ltd (RVNL), Suzlon Energy Ltd, Indus Towers, ICICI Lombard and ICICI Prudential Life Insurance Company Ltd are among a few stocks that can join the largecap club in AMFI’s upcoming classification. The recent debutant Bajaj Housing Finance may also join the largecap pack. Adani Total Gas Ltd, IDBI Bank, Union Bank of India, BHEL and Canara Bank are among a few largecap stocks that can be downgraded to midcap category, a study by Nuvama Institutional Equities suggests.
The cut-off period would span from July 1 to December 31, with the announcement expected in the first week of January. The categorisation will take effect from February 1, 2025.
“Based on current average market-cap levels, we anticipate the large-cap cut-off to be approximately Rs 1.02 lakh crore compared to Rs 84,000 crore as of June 2024 and the mid-cap threshold to hover around Rs 33,300 crore compared with Rs 27500 crore as of June 2024,” Nuvama said.
Among stocks, Cummins India, Indus Towers and Polycab India can also join largecap space. Shree Cements, Mankind Pharma and Apollo Hospitals can slip to midcap category. Smallcap stocks such as Aditya Birla Fashion, GE T&D India, 360 One Wam and 360 One Wam can join midcap category while three newly listed companies namely Premier Energies, Ola Electric Mobility Ltd and Brainbees can be labelled midcaps. Midcap stocks Gland Pharma, Motherson Sumi Wiring, Bandhan Bank and ITI can be sent to smallcap category.
Meanwhile, Raymond Lifestyle, Vibhor Steel, Pn Gadgil Jewellers, Akums Drugs And Pharma, Emcure Pharmaceuticals, Arkade Developers, Sanstar, Northern Arc, Ceigall India and Orient Technologies, among others, may join smallcap category.
Nuvama said a stock recategorisation helps, but not necessarily immediately in term of flows. “As the stocks move up from lower categorization to higher (say small-cap to mid-cap and midcap to large-cap), it increases their visibility. Fund managers typically further analyze such stocks and add them as per their rationale while complying with the scheme mandate,” it said.
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