According to Nuvama Alternative Research, Rail Vikas Nigam Limited (RVNL) and Suzlon Energy are likely to be upgraded to large-cap stocks starting in February 2025, as predicted by the Association of Mutual Funds in India (AMFI). Currently considered mid-cap stocks based on the threshold of ₹27,500 crore, these companies are expected to cross the new large-cap cutoff of ₹1 lakh crore, projected by current average market capitalization levels.
The large-cap cutoff for February 2025 is expected to be around ₹1 lakh crore, compared to ₹84,000 crore in June 2024. Similarly, the mid-cap threshold is anticipated to be approximately ₹33,300 crore, up from ₹27,500 crore in mid-2024, according to the report.
As of now, RVNL has a market capitalization of ₹1.06 lakh crore, while Suzlon Energy’s market capitalization stands at ₹1.05 lakh crore. Both companies have surpassed the ₹1 lakh crore mark, which makes them likely candidates for large-cap classification.
Over the past year, the shares of RVNL have surged by 196%, while Suzlon Energy’s stock has grown by 183%, reflecting strong performance and market interest in both companies. These gains have contributed to their crossing of the ₹1 lakh crore mark, placing them in line for large-cap status.
While recategorization into the large-cap segment does not automatically trigger new investments or withdrawals, active equity fund managers keep a close eye on the list when making adjustments to their portfolios across different fund categories. This means RVNL and Suzlon Energy may see increased attention from institutional investors once their status officially changes.
The process of stock recategorization happens twice a year, and the upcoming list is expected to be released in the first week of January 2025, with the new classifications becoming effective in February 2025. This updated categorization will remain in place until July 2025, giving investors a clear guide to the stocks that have shifted into the large-cap category.
In addition to RVNL and Suzlon Energy, several other companies are also expected to move from mid-cap to large-cap status, including CG Power, Indus Towers, ICICI Prudential, Cummins India, ICICI Lombard, Polycab India, and Bajaj Housing Finance (a recent new listing).
This shift marks an important milestone for RVNL, Suzlon Energy, and other companies as they transition into the large-cap space, potentially leading to broader investor interest and increased visibility in the Indian stock market.
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