Equity mutual funds have emerged as big players in the Indian stock market. With investors pumping thousands of crores each month through lumpsum and SIP investments, how have MFs churned their portfolios? Below are 6 infographics that provide insights into what happened on the equity MF arena in April 2023. Take a look at 10 most stocks bought, 10 most stocks sold, most popular stocks, new stock entries, complete stock exits, sector-wise stock holdings and foreign equity holders among AMCs.
Most bought and sold
In April, mutual funds added holdings in over 350 stocks. These transactions depend on the fund managers’ view, inflows and fund mandate, among other factors. The top 10 most bought stocks (as per buy value) include the likes of Infosys, RHI Magnesita, NTPC, FSN E-commerce, HUL, Cipla, Crompton Greaves Consumer, RIL etc.
On the other end of the spectrum, the most sold stocks in April-2023 had major banking names such as Axis Bank, SBI, Kotak Mahindra Bank and ICICI Bank. Others in this list include Max Healthcare Institute, M&M, ITC, ONGC etc.
Be it the buying and selling list, large-caps dominate. The presence of large-caps is not usual as a large part of total equity MF AUM is present in large-caps.
Most popular stocks
From a most-owned stock perspective, giants of financial services, energy, IT, industrials, telecom, FMCG typically dominate the top half of the list. So, ICICI Bank, based on MF market value and percentage of equity AUM, is the most-owned, followed by HDFC Bank, RIL, Infosys, HDFC, SBI, Axis Bank, L&T, Bharti Airtel, ITC, Kotak Mahindra Bank, TCS and Bajaj Finance.
Next in the list are NTPC, Sun Pharma, Maruti, HUL, HCL Tech., M&M, Ultratech, ONGC, Avenue Supermarts, BEL and PGCIL.
Stocks that entered, exited MF folios
Typically, attractive IPOs or recently listed stocks often make into the list of stocks that find new place in MF portfolios. In April, we saw shares worth over ₹500 crore of Mankind Pharma finding their way into equity MF portfolios. Other new entries were Cube Highways, Avalon Technologies, and Speciality Restaurants.
In the same vein, investors often track stocks that are exited completely by mutual funds. In April, the overall fund industry sold off and reported nil investments in CPCL, Mirza International, Tasty Bite Eatables and Kamdhenu Ventures. Complete exits could be due to various reasons such as non-inclusion in indices, fundamental reasons, other attractive opportunities in the same space taking precedence, alteration of fund manager view on a sector, change in investment style etc.
Sectoral composition, foreign equity holders
Let us take a look at how the equity AUM of Indian MF industry looks through the lens of sectors. Like the broader indices, banks/financial services occupy the biggest weight if one were to look the most-preferred sectors of MF stock holdings. They are followed by consumer discretionary, industrials, IT, commodities, energy, healthcare sectors. Small changes in sectoral exposure could be due to market-linked movements. But over time, often one can see how mutual funds have pared or ramped up exposure to one sector vis-a-vis the other.
Foreign stocks have increasingly captured the imagination of Indian investors. Here’s a look at which AMCs are the big players in foreign equity holdings. Broadly, Motilal Oswal, ICICI Prudential, PPFAS, SBI and Axis fund-houses are dominant holders of foreign equity. In April, the noticeable change of holding happened in ICICI Prudential, followed by PPFAS and SBI.