New Delhi, Aug. 20 -- India's smaller stocks delivered the biggest gains in the June quarter, but the ownership data suggests investors were becoming more selective about them.

A Mint analysis of ACE Equity data covering 4,367 BSE-listed companies found that mutual funds increased their holdings in nearly two-thirds of large- and mid-cap companies during the June quarter, although the breadth of increases was lower than a year earlier. Foreign portfolio investors (FPIs) reduced holdings in a majority of companies in both segments, while retail investors cut exposure across much of the mid- and small-cap universe.

Small-caps gained 29.1% in Q1FY27, compared with 17.2% for mid-caps and 8.9% for large-caps, even as the quarter was marked b...