In the upcoming Amfi Semi-Annual Categorisation for the second half of 2024, seven midcap stocks are expected to be upgraded to the largecap category. These stocks are Hero Motocorp, Zydus Lifesciences, JSW Energy, NHPC, Bharat Heavy Electricals (BHEL), Bosch, and Samvardhana Motherson International. The final decision will be based on the semi-annual cut-off date, which is June 30, 2024, according to a note by IIFL Securities.
Expected Largecap Upgrades
These seven midcap stocks have shown impressive performance over the past year, with four of them delivering outstanding returns, also known as multibaggers. BHEL leads the group with a whopping 247% return. Hero Motocorp, Samvardhana, and Bosch have also performed well, achieving high double-digit returns of up to 96%.
Potential Downgrades to Midcaps
On the flip side, some current largecap stocks are expected to be downgraded to midcap status. These include ICICI Prudential Life Insurance Company, ICICI Lombard General Insurance Company, Polycab India, SRF, Marico, SBI Cards & Payment Services, and Berger Paints. Among these, SBI Cards and Berger Paints have been the poorest performers, with negative returns of 23% and 11% respectively over the last year. All but Polycab India and ICICI Lombard have underperformed the Nifty, which has shown a 25% return during this period.
Changes in Midcap and Smallcap Categories
In addition to these changes, IIFL Securities predicts that two new companies will enter the midcap category: Bharti Hexacom and Go Digit General Insurance.
Furthermore, 15 smallcap stocks are likely to be promoted to the midcap category. These include Housing & Urban Development Corporation (HUDCO), I R B Infrastructure Developers, Mangalore Refinery & Petrochemicals (MRPL), Bharat Dynamics, Global Health (Medanta), BSE, NLC India, Hitachi Energy India, Tata Investment Corporation, National Aluminium Company (NALCO), Hindustan Copper, Cochin Shipyard, ITI, Motilal Oswal Financial Services (MOFSL), and Godrej Industries.
Conversely, 17 midcap stocks are expected to be demoted to the smallcap category. This list features Narayana Hrudayalaya, Sun TV Network, Bayer Cropscience, Vedant Fashions, Grindwell Norton, Timken India, Sundram Fasteners, Hatsun Agro Product, Kansai Nerolac Paints, SKF India, Creditaccess Grameen, Relaxo Footwears, Ramco Cements, Devyani International, Piramal Enterprises, IIFL Finance, and Zee Entertainment Enterprises (Zee).
New Entrants to Smallcap
The note also predicts 26 new entrants to the smallcap category. These include companies like Kronox Lab Sciences, Jyoti CNC Automation, Mukka Proteins, Gopal Snacks, Juniper Hotels, and Indegene.
These shifts in classification reflect changes in market capitalisation and performance, highlighting the dynamic nature of the stock market. Investors can use these updates to make informed decisions about their portfolios.
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