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Large cap, mid-cap and small cap stocks that MFs traded in Mar-22

Equity fund flows were robust in FY22, with full year SIP inflows of Rs124,566cr. That was just the macro story. The SIP flows in Mar-22 at Rs12,328cr was a record even as overall flows into equity funds for Mar-22 scaled a record Rs28,600cr

April 18, 2022 12:08 IST | India Infoline News Service
Equity fund flows were robust in FY22, with full year SIP inflows of Rs124,566cr. That was just the macro story. The SIP flows in Mar-22 at Rs12,328cr was a record even as overall flows into equity funds for Mar-22 scaled a record Rs28,600cr. Amidst these trends, the new fund offerings (NFOs) of multi-cap funds, index funds and BAFs managed to attract a lot of investor interest. Today passive and hybrid AUM alone is about 27.5% of overall MF AUM.

In a year when foreign portfolio investors (FPIs) sold over Rs140,000cr of equities in just 6 months, it is the domestic funds that came to the rescue of the markets and virtually prevented a free fall. While LIC has been a key buyer, a lot of the buying also came from the Indian mutual funds amidst robust flows into equity funds. Here is what Indian mutual funds bought and sold in the month of Mar-22, across capitalization categories.

Large cap stocks bought and sold by Mutual Funds in Mar-22

For this purpose, large caps have the same definition as given by AMFI, i.e. the top-100 stocks ranked by market cap in the Indian market. Here is a quick look at the top mutual fund large cap buys in Mar-22.

Company Name Net Quantity Bought Buy Value (Rs. Crore)
HDFC Bank 318.24 lakh ₹ 4,609
Kotak Mahindra Bank 159.12 lakh ₹ 2,862
HDFC Ltd 89.92 lakh ₹ 2,138
Maruti Suzuki India 25.52 lakh ₹ 2,026
ONGC Ltd 975.27 lakh ₹ 1,583
Hindustan Unilever 71.96 lakh ₹ 1,519
ICICI Bank 199.80 lakh ₹ 1,472

What were the major large cap buy themes? It looks like there was some buying ahead of the merger of HDFC and HDFC Bank, which was always on the cards. There appears to be a lot of interest in the rate sensitives as is evident from names like Kotak Bank, ICICI Bank and Maruti, perhaps on the hope, either that the Fed may be less than hawkish or the RBI may not exactly follow suit. For now, the latter assumption appears to be playing out. ONGC has been on the buy list for some time due to the spike in crude oil prices while Hindustan Unilever saw value buying after the 30% correction in the stock amidst thinning OPMs.

Let us now turn to the major large selling by Indian mutual funds in Mar-22.

Company Name Net Quantity Sold Buy Value (Rs. Crore)
ITC Ltd. 1,150.91 lakh ₹ 2,685
Hindalco Industries Ltd. 277.37 lakh ₹ 1,586
Sun Pharmaceutical 119.51 lakh ₹ 1,051
UPL Ltd. 129.15 lakh ₹ 927
Bharti Airtel 121.68 lakh ₹ 877
JSW Steel 91.93 lakh ₹ 625
Cipla Ltd. 53.45 lakh ₹ 519
Tata Consultancy Services 13.05 lakh ₹ 476

The top 3 stocks on the mutual fund sell list in Mar-22 viz. ITC, Hindalco and Sun Pharma are the stocks that have also given the most phenomenal profits. Among others, UPL saw some aggressive selling on plans of change in management. While Bharti Airtel was another stock that saw some full value selling by fund managers, the TCS selling was more of a buyback participation during the month. Overall, the large cap selling was centred around stocks that had appreciated sharply in the last few months and profits were being taken off the table.

Mid-cap stocks bought and sold by Mutual Funds in Mar-22

Before we get into the mid-cap fund buying / selling story, it must be remembered that we have used the same definition as given by AMFI, i.e. the stocks ranked 101 to 250 by market cap in the Indian market. Here is a quick look at the top mid cap bought by mutual funds.

Company Name Net Quantity Bought Buy Value (Rs. Crore)
Coforge Ltd. 29.68 lakh ₹ 1,334.54
Indian Hotels 558.78 lakh ₹ 1,223.59
Max Healthcare Institute 271.45 lakh ₹ 979.99
United Breweries 35.79 lakh ₹ 535.08
Bharat Forge 75.85 lakh ₹ 523.07
Sundaram Finance 24.84 lakh ₹ 476.72
Bandhan Bank 145.03 lakh ₹ 445.02

The mid-cap buys are normally very stock specific, unlike large caps that are more sectoral or macro driven. There were some obvious names. Coforge (formerly NIIT Tech) has been among the star IT stock performers and has been constantly in the buying list. Indian Hotels is a turnaround play as contact sensitive sectors get reopened. Bandhan Bank was largely on the back of the proposed deal to acquire the assets of IDFC Mutual Fund, with Bandhan Finance already shortlisted as the consortium lead to take over IDFC MF.

Here is a quick look at the top mid cap sold by the mutual funds.

Company Name Net Quantity Sold Buy Value (Rs. Crore)
NALCO Ltd. 323.91 lakh ₹ 393.77
Voltas Ltd. 29.68 lakh ₹ 372.31
Persistent Systems 7.41 lakh ₹ 322.33
Tube Investments of India 17.61 lakh ₹ 276.33
Jindal Steel & Power 55.83 lakh ₹ 267.33
L&T Finance Holdings 302.12 lakh ₹ 221.38
Shriram Transport Finance. 17.71 lakh ₹ 200.08

The mid cap selling by mutual funds was largely focused on metals and financial services. Just as Hindalco was among the big sells in the large cap space, NALCO has been among the big sells in the mid cap space. Interestingly, the mutual funds also did a good deal profit booking on Voltas and Persistent Systems, which have been among the finest mid-cap performers. The month of Mar-22 also saw some aggressive selling in financials like L&T Finance and Shriram Transport on expectations that a spike in yields would impact the borrowing costs of these NBFCs a lot more than the banks.

Small cap stocks that mutual funds bought and sold in Mar-22

Before we get into the small-cap fund buying / selling story, we have used the same definition as given by AMFI, i.e. stocks ranked beyond 250 by market cap in the Indian market. Here is a quick look at the top small cap stocks bought by mutual funds.

Company Name Net Quantity Bought Buy Value (Rs. Crore)
Vardhman Textiles 343.26 lakh ₹ 5,126.72
Rajratan Global Wire 32.72 lakh ₹ 468.30
Ramkrishna Forgings 68.66 lakh ₹ 332.98
GR Infraprojects Ltd. 18.54 lakh ₹ 268.68
MCX of India Ltd. 14.90 lakh ₹ 200.21
Radico Khaitan Ltd. 12.63 lakh ₹ 112.49

Normally, small caps do not evidence sectoral trends and are largely stock-specific. However, it must be noted that buying in small caps has been quite aggressive as mutual funds tried to dig for alpha amidst some sharp correction in small cap stocks. Now we turn to a list of major sells by mutual funds in the small cap space.

Company Name Net Quantity Sold Buy Value (Rs. Crore)
Century Plyboards (India) 26.88 lakh ₹ 176.00
KEI Industries Ltd. 14.63 lakh ₹ 164.52
VIP Industries Ltd. 21.40 lakh ₹ 148.23
RBL Bank Ltd. 106.55 lakh ₹ 140.40
UTI AMC Ltd. 15.21 lakh ₹ 139.24
GNFC Ltd 19.56 lakh ₹ 136.70
Mahanagar Gas Ltd. 11.60 lakh ₹ 87.38

To sum up the story, Mar-22 saw mutual funds indulging in some real churn; booking profits and also doing some value digging in mid cap and small cap stocks.

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