Mumbai: Private banks, the top sectoral holding of mutual funds, saw their weightage touch a new high in June. The segment, which surged by 2.6 times in the past five years, saw an increase in holding for the ninth successive month to a new high of 19.9 per cent, according to a report by Motilal Oswal Financial Services.
Mutual funds have now also started buying the Small-Cap and Mid-Cap stocks selectively, said another report.
On month-on-month basis, the weight of private banks, consumer, utilities, technology, NBFCs, retail, metals and PSU Banks increased, while that of oil & gas, chemicals, autos and cement moderated as June saw a notable change in sector and stock allocation of the top mutual funds, the report said.
"Private Banks (19.9 per cent) was the top sector holding in June 2019, followed by NBFCs (9.2 per cent), Technology (8.7 per cent) and Capital Goods (8 per cent)," Deven Mistry, Research Analyst, Motilal Oswal Securities said.
Retail, utilities, metals, real estate and consumer were the top sectors witnessing an increase in value month on month.
In terms of value increase month-on-month basis, six of the top 10 stocks were from Financials in June 2019 - ICICI Bank, HDFC Bank, Shriram Transport Finance, SBI, Bajaj Finance, and HDFC.
NTPC saw value increase of Rs 1,260 crore in June 2019, as the stock was up 6 per cent. Notably, the stock saw net buying by 16 of the top 20 mutual funds.
In terms of value decrease month on month basis, five of the top 10 stocks were from Oil & Gas. Reliance Industries, GAIL, Yes Bank, HPCL and UPL witnessed the maximum decline in value on month-on-month basis.
"Banks, finance, software, consumer non-durables and petroleum products were the top 5 sectors where equity AUMs invested their funds in June 2019 and they cumulatively accounted for around 55.6 per cent share," said another Analysis by Care Ratings.
According Emkay Global Financial Services, "Among sectors, mutual funds incrementally preferred banks, capital goods and NBFCs, while they took money off from oil & gas, auto and pharma sector stocks.
"Preference of the Small-Cap and Mid-Cap stocks has been inching up among mutual funds, after bottoming in December 2018 quarter. Emami and Shriram Transport Finance were the key stocks bought, while UPL and Power Grid saw large selling by mutual funds," Emkay Global said.
On the debt side, the overall exposure of mutual funds to NBFCs stood at Rs 2.02 lakh crore in June 2019, a drop of Rs 63,000 crore since July 2018, when the NBFC crisis began. While the amount has reduced, the percentage share also fell from 19 per cent in July 2018 to 14.8 per cent of debt asset under management (AUM)in June 2019.
Investments in corporate debt paper of NBFCs fell to around Rs one lakh crore in June 2019. The percentage share also declined to 7.35 per cent of debt AUMs in June 2019, compared with July 2018.