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What is BSE Midcap Index ?

BSE Largecap

The BSE Midcap Index is a benchmark index of the Bombay Stock Exchange (BSE) that tracks and measures the performance of India’s mid-sized companies in terms of market capitalisation. It represents captures about 15% of the total market capitalisation of the BSE AllCap Index.

Why Choose BSE Midcap Index?

Balanced Profile – Less volatility than small cap stocks; higher long-term growth potential than large caps.

Growth – Potential opportunities from growing businesses.

Value – Exposure to companies with intrinsic value and long-term potential.

Diversification – A range of businesses in their stage of expansion.

How are BSE MidCap companies selected?

The BSE Midcap comprises 150 stocks ranked 101 to 250 on the BSE AllCap index. To enter the AllCap universe, a company must meet the following criteria:

Liquidity and trading quality

  • Impact cost of 1% or less over the prior six months
  • Trading frequency of at least 80%
  • Turnover ratio of 5% or higher

Minimum market size thresholds

  • Rank within the top 1,500 by average daily total market capitalization
  • Rank within the top 2,000 by free-float market capitalization
  • Rank within the top 2,000 by annualized traded value

Once the AllCap universe is formed, companies are sorted by cumulative average daily market capitalization to determine size tiers. The first 70% are large caps, the next 15% are mid caps, and the final 15% are small caps, with a ±5% buffer to limit turnover.

How to invest in BSE MidCap?

Investors can gain exposure to the BSE MidCap Index through index funds and exchange-traded funds (ETFs) that track the index. Investors may also choose to buy individual mid cap stocks, though this requires detailed research and due diligence.

Risks associated with BSE MidCap direct investments?

Midcap stocks tend to carry relatively higher risk compared to large-cap stocks due to their comparatively smaller size and greater sensitivity to market movements. Since investors cannot invest directly in the BSE MidCap Index, accessing this segment typically involves index funds, ETFs, or buying individual mid cap stocks.

Direct stock selection can be riskier, as it is difficult to replicate the index’s composition and weightage or to rebalance the portfolio if the index composition changes. Midcap companies may also face sharper price fluctuations during periods of economic uncertainty, liquidity constraints, or changes in industry cycles. Investors should assess their risk appetite, investment horizon, and diversification needs before considering mid cap exposure.

Historical returns of BSE MidCap Index

Historically, the mid cap segment has shown periods of higher returns compared to large caps over longer horizons, although it has also experienced relatively higher short-term volatility.

Past performance may or may not be sustained in future

Future outlook for BSE MidCap companies in India

Several structural factors may influence growth prospects for mid-sized companies over time:

Economic growth: Midcap companies are expected to potentially benefit from rising demand across industries as India’s economy expands.

Expanding sectors: Many mid cap firms operate in growing industries such as technology, financial services, manufacturing, pharmaceuticals, and consumer goods.

Government initiatives: Programs like ‘Make in India’, infrastructure development, and sector-specific reforms may create potential opportunities for mid-sized businesses to scale and innovate.

Rising domestic consumption: With a growing middle class and increasing disposable incomes, demand for products and services from mid cap companies may increase steadily over time.

List of BSE MidCap companies

BLUE STAR LTD.
EXIDE INDUSTRIES LTD.
CRISIL LTD.
BHARAT HEAVY ELECTRICALS LTD.
HINDUSTAN PETROLEUM CORPORATIO
STEEL AUTHORITY OF INDIA LTD.
GODREJ INDUSTRIES LTD.
KANSAI NEROLAC PAINTS LTD.
WHIRLPOOL OF INDIA LTD.
LIC HOUSING FINANCE LTD.
THE RAMCO CEMENTS LIMITED
Max Financial Services Limited
MRF LTD.
Patanjali Foods Limited
TATA ELXSI LTD.
ACC LTD.
THERMAX LTD.
PROCTER & GAMBLE HYGIENE & HEA
FEDERAL BANK LTD.
ASHOK LEYLAND LTD.

*Data as on November 2, 2025. Please refer to the exchange website for the exhaustive list of BSE MidCap Companies.

Please note that the reference to any industry/sector/stock is provided for illustrative purposes only. This should not be construed as a research report or a recommendation to buy or sell any security or sector.

FAQs

When was the BSE MidCap introduced?

The BSE MidCap was launched on April 11, 2005.

Is BSE MidCap investment suitable for beginners?

Those with a long investment horizon and a high risk appetite may explore mid cap funds after developing adequate understanding of market risks or with professional guidance. Suitability varies by individual goals and risk tolerance.

How does market volatility impact mid cap stocks?

Mid cap stocks tend to be more sensitive to market volatility than large caps due to their relatively smaller scale of operations. During periods of market uncertainty or economic downturns, mid cap stocks often experience sharper price declines. Conversely, in bull markets, mid cap stocks may outperform large caps due to their higher growth potential.

Should I invest in mid caps through BSE or NSE indices?

Both BSE and NSE are reputable exchanges. NSE typically offers higher liquidity and faster trading, while BSE is older with broader coverage. Choice depends on stock availability, trading convenience, and personal preference.

What should I do when BSE MidCap is falling?

When BSE MidCap index or stocks fall, it is advised to avoid panic selling and review your investment goals and time horizon. Consider whether the price drop reflects temporary market conditions or fundamental issues with the companies. If you have a long-term outlook, falling prices might present potential buying opportunities to accumulate quality mid cap stocks at lower valuations. Maintaining a diversified portfolio and consulting a financial advisor may help manage risk in volatile phases.

Which is larger, BSE or NSE?

NSE is the largest stock exchange in India by daily turnover and traded volume. BSE is older and has more listed companies, but lower daily trading volume compared to NSE.

What is the lot size of BSE?

BSE stock lot sizes vary by company. For most equity shares, one lot equals one share, but derivatives and certain other instruments have specified lot sizes determined by the exchange.

Is BSE better than NSE?

Neither is inherently better; both are prominent exchanges. NSE typically has higher trading volumes and faster trading, while BSE has more listed companies and is an older exchange. The choice depends on trading preferences.

Can I buy in BSE and sell in NSE?

No, stocks are exchange-specific. Buying on BSE and selling on NSE directly is not possible, though most stocks are listed on both exchanges. You must transact on the same exchange or through portfolio holdings.

Is BSE stock a suitable buy?

Whether a BSE-listed stock is a suitable buy depends on its fundamentals, valuation, and growth potential and your own investment horizon and risk appetite. Review company performance, financial health, and long-term prospects before investing rather than choosing based on the exchange alone. Investors may review goals, risk tolerance, and time horizon before deciding.

Past performance may or may not be sustained in future.

Are BSE MidCap stocks suitable for the long term?

Mid cap stocks may be suitable for investors with a very high risk appetite and a long-term perspective. They offer long-term growth potential but also carry relatively higher volatility compared to large caps. Investors may review goals, risk tolerance, and time horizon before deciding.

Soumya Rao
  • Sr Content Manager, Bajaj Finserv AMC Soumya Rao is a writer with more than 10 years of editorial experience in various domains including finance, technology and news.

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Disclaimer

Mutual Fund investments are subject to market risks, read all scheme related documents carefully. This document should not be treated as endorsement of the views/opinions or as investment advice. This document should not be construed as a research report or a recommendation to buy or sell any security. This document is for information purpose only and should not be construed as a promise on minimum returns or safeguard of capital. This document alone is not sufficient and should not be used for the development or implementation of an investment strategy. The recipient should note and understand that the information provided above may not contain all the material aspects relevant for making an investment decision. Investors are advised to consult their own investment advisor before making any investment decision in light of their risk appetite, investment goals and horizon. This information is subject to change without any prior notice. The content herein has been prepared on the basis of publicly available information believed to be reliable. However, Bajaj Finserv Asset Management Ltd. does not guarantee the accuracy of such information, assure its completeness or warrant such information will not be changed. The tax information (if any) in this article is based on prevailing laws at the time of publishing the article and is subject to change. Please consult a tax professional or refer to the latest regulations for up-to-date information.

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Our Investment Philosophy

Our Investment Philosophy reflects what we, as an organisation, believe will generate a good return on equity investment for our investors in the long term. It dictates our goals and guides decision making.


Alpha (a) is a term used in investing to describe an investment strategy’s ability to beat the market.


Alpha is thus also often referred to as excess return or the abnormal rate of return in relation to a benchmark, when adjusted for risk. Essentially, it means doing better than the crowd without taking disproportionate risk.

Information Edge

Collecting superior information

Analysts and portfolio managers strive to collect superior information about the business and the management of the company. They try to generate superior earnings forecast and the balance strength of the company and the industry, thereby trying to 'beat the market' on information edge. This is an important source of alpha for an investor. However, over the years, retaining the information edge has become more difficult and expensive. With a whole lot of investors trying to collect superior information, how can an investor be sure to continuously have accurate and material information about the companies, ahead of others, all the time?

Quantitative Edge

Processing information better

Even if you don't have material information earlier than the crowd, you can still generate better outcomes if you are able to process this information better. Investors develop models and algorithms with enhanced predictive powers to forecast the next move. Fund managers who invest based on some pure formal analytical models are quantitative managers. Here, the goal is to try and beat other investors based on the sophistication of procedures or analytics. The analytical edge can be quite useful until it gets copied by many, and then it may stop generating superior returns.

Behavioural Edge

Exploiting behavioural biases

As the name suggests, this edge is achieved by superior behaviour in reacting to the inputs available to maximise alpha. Modern finance assumes people behave with extreme rationality. However, researchers in behavioural finance have shown that this is not true. Moreover, these deviations from rationality are often systematic. Behavioural managers try to exploit situations where securities are mispriced by the market because of behavioural factors. At Bajaj Finserv AMC, we endeavour to combine the best of these edges.