Re-categorisation of stocks: Fund managers seek review of new norms

Want flexible methodology to define large- and mid-cap stocks

Equity fund managers, who manage assets worth Rs 6 trillion, are seeking a review of the re-categorisation norms introduced by the Securities and Exchange Board of India (Sebi) about two years ago. 

Money managers are of the view that some tweaking in the methodology prescribed for classifying a stock as large-, mid- or small-cap will bring about more flexibility in their investment calls and help curb unnecessary churn.

Under existing norms, the top 100 companies by market value fall in the large-cap bracket, the next 150 are tagged as mid-caps and the remaining stocks fall in the small-cap universe.

MFs