New Delhi, Oct. 30 -- Foreign Institutional Investors (FIIs) are drawn to mid-cap stocks because they offer a compelling combination of market dynamism, capital efficiency, and growth potential that larger, more crowded companies may struggle to match.

Midcap stocks typically deliver higher earnings growth than large caps, especially during expansionary cycles in the economy. According to reports, in recent quarters, this segment recorded earnings growth significantly higher than large caps, attracting FIIs seeking superior returns.

FIIs tend to diversify away from an overabundance of large-cap stocks and industries that might experience valuation ceilings or cyclical slowdowns by increasing their exposure to midcaps.

In any case, here...