InvestorQ : What are the key stocks that mutual funds bought and sold in the month of July 2022?
Deepa Salunkhe made post

What are the key stocks that mutual funds bought and sold in the month of July 2022?

Arya Nanda answered.
2 months ago

For the month of July 2022, the Indian mutual funds were overall quite aggressive in churning the portfolio. Let us first look at the large cap portfolio, defined as the top 100 companies ranked descending by market cap. Top large cap additions were Maruti, Kotak Bank, Tata Motors and HDFC Life Insurance. However, during the month, the mutual funds trimmed their positions in HDFC Ltd, ITC, SBI Life and Larsen and Toubro. The trends have been too stock specific as the funds have looked more to rebalance their portfolios.

Let us now turn to the mid-cap space. In terms of the AMFI definition, the mid-caps are defined as the companies ranked from 101 to 250 when they are ranked descending on market capitalization. For the month of July 2022, the major additions to the portfolio of mutual funds included stocks like Zomato, Gland Pharma, Indian Hotels and HPCL, all strategic buys are lower levels. Mutual funds also cut their positions in stocks like Polycab India, PVR, KEI Industries and L&T Technology Services or LTTS in the mid-cap space.

We finally come to the small caps. In AMFI parlance, small caps are defined as companies that rank below 251 in the market cap rankings of stocks on the NSE and the BSE combined. Some of the key small cap buys in the month were stocks like Sapphire Foods, Granules India and Sobha. At the same time, mutual funds were selling into small cap stocks like Birlasoft, Metropolis Health, Indiabulls Housing Finance and Gujarat Heavy Chemicals Ltd or GHCL. Most of the picks were largely stock specific in this case.

In the month of July, equity funds attracted Rs8,898 crore into active funds and much higher amounts into passive funds. It is nearly one and half years that the equity mutual funds witnessed consistent net inflows. Of course, the higher levels of redemptions in debt mutual funds continued to persist. A lot of the market support came from SIP contribution which stayed robust at Rs12,140 crore in the month of July even as lumpsum flows into equity funds were tepid.