From IRFC to Polycab India, eight stocks move up the ladder to largecap- QHN

Eight stocks including Indian Railway Finance Corporation (IRFC), Polycab India, Macrotech Developers (Lodha) are seen migrating from midcap to largecap universe. Meanwhile, 13 stocks will graduate from smallcap universe to midcap universe during the semi-annual rebalancing due next month.

“Based on the average market cap from July 1 to October 31, there are a lot of stocks expected to migrate between market cap segments. However, with around one-third of the review period yet to go, there will be changes to the list as stock prices move around,” said analyst Brian Freitas of Periscope Analytics who publishes on Smartkarma.

Shriram Finance, Union Bank of India, Indian Overseas Bank, Rural Electrification and Power Finance are the other stocks in pole position to make it to the largecap universe.

Meanwhile, stocks that could get downgraded from largecaps to midcaps are UPL, Adani Wilmar, Indian Railway Catering and Tourism (IRCTC), Pi Industries, Bosch, Tube Investments, Hero Motocorp, and Samvardhana Motherson.

The Association of Mutual Funds in India (Amfi) reclassifies stocks every six months based on their average market capitalisation (mcap) during first and second six-month period of a calendar year. Top 100 stocks by average mcap qualify for the largecap status, the next 150 for midcap and the remaining are smallcaps.

The changes could impact portfolios of stocks with assets under management of nearly Rs 11 trillion. Among the stocks seen moving from smallcap to the midcap segment are Maza­gon Dock Shipbuilders, Suzlon Energy, Lloyds Metals, SJVN (SJVN IN), Kalyan Jewellers, and CreditAccess Grameen.

Newly-listed firms Jio Financial and JSW Infra will directly make it to the largecap and midcap segments, respectively. Currently, there are 99 stocks classified as largecap following the merger of HDFC Bank and HDFC.

Rajesh Exports, Aarti Indu­stries, Pfizer, Vinati Organics (VO IN), and Crompton Greaves Consumer are expected to get downgraded from midcaps to smallcaps.

Polycab India and Lodha are also in the reckoning to make it to MSCI global index.