InvestorQ : Do you an idea about the major stocks that India’s largest mutual fund, SBI MF has been churning in the last few weeks?
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Do you an idea about the major stocks that India’s largest mutual fund, SBI MF has been churning in the last few weeks?

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Niti Shenoi answered.
1 week ago
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For the month of January 2021, SBI Mutual Fund has been betting heavily on the public sector stocks. In fact, it has been buying aggressively into some of the biggest buyers in the PSU space. For example, SBI MF added some of the well-known PSU names to its portfolio like SAIL, NHPC, Indian Oil, NTPC and Bank of Baroda during the month of Jan-21.

In addition, the SBI Mutual Fund has also been selectively picking private banking names like ICICI Bank, Axis Bank and HDFC Bank and adding them to the portfolio. It does look like SBI MF is betting on a re-rating of PSU stocks in a big way. It is expected that in the next few months the government will proceed aggressively on its privatization drive.

You would know that the government has also been putting is pressure on PSUs to reward shareholders through corporate actions like dividends and buybacks to enhance returns and make these stocks more attractive. According to an SBI note, in the last 10 years EM stocks have underperformed compared to US equities and PSUs could trigger the catch up rally.

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