88 stocks, 57.9% active share: How Edelweiss Large & Mid Cap Fund is positioning for the next market cycle

Edelweiss Large & Mid Cap Fund is taking a distinctly active approach to stock selection, with 88 holdings and an active share of 57.91%, while favouring capital goods, autos and consumer durables as it positions for India’s medium- to long-term growth.

The fund had 88 stocks in its portfolio as of July 31, 2026, with its top 10 holdings accounting for 23.34% of the portfolio. Its 57.91% active share indicates that a significant portion of the portfolio differs from its benchmark positioning.

The fund’s largest active positions included Ather Energy, Bharat Heavy Electricals (BHEL), Phoenix Mills, Ashok Leyland, Power Mech Projects, Solar Industries India, Federal Bank, L&T Finance, Billionbrains Garage Ventures and Max Healthcare Institute. Ather Energy had the highest active share contribution at 1.06%, followed by BHEL at 0.85%.

The portfolio was estimated to comprise 50% large-cap, 36% mid-cap and 14% small-cap stocks. The fund said the large-cap exposure provides stability and earnings resilience, while mid-caps offer higher growth potential. Select small-cap holdings are used to gain exposure to differentiated themes and opportunities less represented in broader indices.

Betting on capital goods, autos and consumer durables

The fund is currently overweight on capital goods, autos and consumer durables, while maintaining underweight positions in metals, oil & gas and FMCG.

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The positioning comes against a backdrop that the fund manager describes as favourable for Indian equities. According to the fund commentary, credit growth, auto volumes, property sales, power demand and the June 2026 earnings season have been showing positive trends.

The fund also pointed to healthy corporate balance sheets, declining leverage and capacity utilisation rising to the mid-70% range as factors supporting its medium- to long-term constructive view on Indian equities.

Stock selection remains central

Rather than following a strict value or growth style, the fund uses its FAIR investment framework — Forensics, Acceptable Price, Investment Style Agnostic and Robustness.

The framework assesses accounting quality, board governance and ownership background, while seeking reasonably priced businesses with medium-term earnings power. It also focuses on well-managed companies with scalable opportunities and superior return on capital employed.

The strategy has translated into a long-term performance record. The fund's Direct Growth plan delivered a 14.61% CAGR over five years and 15.68% over 10 years, compared with 14.48% and 15.23%, respectively, for the Nifty Large Midcap 250 TRI. Since inception, the Direct plan has generated a 16.03% CAGR, against 13.33% for the benchmark.

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