Mumbai: As the earnings season progressed, stocks of automobile, oil & gas, healthcare, PSU bank and consumer-focused companies became the top picks of fund managers in October 2019 while technology, capital goods, private banks, NBFCs, cement, metals and telecom stocks were avoided by them.
Mutual funds in total invested Rs 3,485.52 crore in equities and Rs 40,023.10 crore in debt instruments in October, as per Sebi data.
According to capital market data aggregator Prime Databasethe , mutual fund industry’s cash level increased in October by Rs 59,899 crore, indicating caution as the benchmark indices touched record highs.
The top 10 equity holdings by value, of the mutual fund industry, included HDFC Bank, ICICI Bank, Reliance Industries, Infosys, Larsen & Toubro, Axis Bank, SBI, HDFC, ITC and Kotak Mahindra Bank. The other big holdings by value included TCS, NTPC, Bharti Airtel, Bajaj Finance, Maruti Suzuki, Sun Pharma, BPCL, HUL, IndusInd Bank and HCL Technologies.
“The month saw a notable change in sector and stock allocation of funds. On a month-on-month basis, the weight of automobiles, PSU banks, oil & gas, healthcare and consumer increased, while that of technology, capital goods, private banks, NBFCs, cement, metals and telecom moderated,” said a report by Motilal Oswal Financial Services.
As Infosys share price saw a big drop in October over an anonymous whistleblower complaint. Technology’s weight hit a 17-month low of 8.2 per cent in the MF industry. As a result, the sector slipped to the fifth position in sector allocation of mutual funds from second in August 2019.
Oil & gas’ weight increased for the fourth successive month to hit an all-time high of 8.7 per cent. The sector is now at the third position in sector allocation–it was at the seventh position 12 months ago.
In terms of value increase month-on-month, six of the top 10 stocks were from the financial sector: SBI, Axis Bank, ICICI Bank, Bandhan Bank, ICICI Lombard and HDFC.
Reliance Industries’ value increased by Rs 3,850 crore, with the stock gaining 9.9 per cent. Notably, the stock saw net buying by 8 of the top 20 funds, according to Motilal Oswal.
Stocks exhibiting maximum decline in value month-on-month were Infosys, IndusInd Bank, Century Textiles, Aurobindo Pharma and Interglobe Aviation.