Suits & Sayings: Under Watch

Some folks on Dalal Street are miffed with the capital market regulator for its recent comments on froth in small and mid-cap stocks. This was meant as a warning to the mutual fund industry to tighten risk-management practices. But equity enthusiasts worry it may end the party in such stocks. While Sebi has reiterated that it has only asked the mutual fund industry to conduct stress tests in small-cap and mid-cap equity schemes, the watchdog's heightened vigil has triggered talk that a regulatory probe might be going on into the investments of some large mutual fund equity schemes in smaller shares. Industry execs, however, have been quick to say there is no such investigation.

(For more on our weekly roundup of wackiest whispers and murmurs in corporate corridors & policy parlours, pick up today's edition of The Economic Times newspaper)