Five mid-cap stocks and one newly listed stock enter the large cap list

The recent market capitalisation review of stocks by AMFI shows that 5 mid-cap stocks have been now reclassified as large cap stocks. These 5 companies are Adani Enterprises, Hindustan Aeronautics, Jubilant Foodworks, PI Industries and Yes Bank.

Apart from these 5 companies, Gland Pharma whose IPO came in November 2020, has also been included in the large cap category by AMFI.

Meanwhile, 6 companies that were listed as large cap stocks have now been classified as mid cap stocks. Bank of Baroda, Container Corporation of India, General Insurance Corporation of India, M.R.F., NMDC and United Breweries are the 6 stocks that saw a drop in their market capitalisation during Jul-Dec 2020. Consequently, they were re-categorised as midcaps as per SEBI definition.

 Stocks that have been classified to mid cap from small cap are Laurus Lab, Indiamart Intermesh, Dixon Technologies, Navin Fluorine, Astrazeneca Pharma, Deepak Nitrite, Bombay Burmah, Suven Pharma, P&G Healthcare, Granules India and Persistent Systems.

Now, mutual funds will have to rebalance their portfolio based on the new categorisation.

In October 2017, SEBI recommended uniform definitions for large cap, mid cap and small cap companies to ensure a standardised investment universe across all fund houses.

As per SEBI definition, large cap companies are the first 100 companies in terms of full market capitalization, while companies with market capitalisation from 101 to 250 rank are categorised as mid caps. Small cap companies are those beyond the 250th rank.

Accordingly, AMFI in consultation with SEBI and the exchanges (NSE and BSE) publishes a list of stocks on a half-yearly basis. After the release of this list, fund houses have a month’s time to rebalance their portfolio. Generally, there is a slight churn in portfolios after AMFI publishes the new list.

In the new list, AMFI has identified 5,044 stocks as of December 2020 as against 5,004 stocks as of June 2020.