India's Top 20 Stocks Slip to 28% of Market Cap as Small‑Midcaps Lead

Jefferies reported that the 20 largest Indian stocks now account for just 28% of the country's total market capitalisation, the lowest share since 2020. The brokerage noted that this contrasts sharply with global markets, where a handful of AI‑linked stocks dominate. Small‑ and mid‑cap stocks have outperformed large‑caps, with the Nifty MidCap 100 index up 99% since the start of 2023 versus a 33% rise for the Nifty 50. Earnings growth forecasts show large‑caps expected to earn 14‑15% annually over the next two fiscal years, while mid‑caps are projected to grow at about 20%.

A separate report by Vallum Capital showed that Indian large‑cap mutual funds attracted the biggest net inflows in June, drawing Rs 9,656 crore despite delivering the poorest year‑to‑date performance. Mid‑cap funds saw Rs 1,336 crore of inflows and small‑cap funds received Rs 4,508 crore, with small‑caps posting the strongest YTD return of 9.3%. Overall equity inflows rose to Rs 48.9 billion, while fixed‑income and money‑market assets continued to see net outflows.