How MFs churned large caps, mid-caps, and small caps in May 2025

16 Jun 2025 , 09:54 AM

GROSS CHURN BY MUTUAL FUNDS IN MAY 2025

May 2025 saw domestic equity funds getting lower net inflows of ₹19,013 Crore; -21.7% lower than the ₹24,269 Crore net equity inflows in April 2025. Since December 2024, the net equity fund inflows have been progressively lower for 5 months in a row. To get a picture of how mutual fund flows impacted equity buying and selling; we need to look at gross purchases and redemptions in equity funds for May 2025.

Net inflows into equity funds to the tune of ₹19,013 Crore comprised of gross purchases of ₹56,604 Crore and gross redemptions of ₹37,591 Crore. This total volume of ₹94,195 Crore impacts equity buying and selling by mutual funds. Of course, there will also be the equity impact of some flows into hybrid funds and passive funds, but we will leave that for now. We break up this churn into large cap, mid-cap, and small cap stocks for May 2025.

HOW MUTUAL FUNDS CHURNED LARGE CAP STOCKS IN MAY 2025

How do we define large cap stocks? We stick to the AMFI classification of Top-100 stocks ranked by market cap. These are also reviewed by AMFI twice a year to ensure values are reflective. Here is the large cap churn in May 2025.

Let us start with the mutual fund large cap buys first! Overall, the mutual funds added 2,242 Lakh shares of Eternal Ltd (Zomato), 1,886 Lakh shares of ITC Ltd, 715 Lakh shares of Swiggy Ltd, 114 Lakh shares of DLF Ltd, 92 Lakh shares of Interglobe Aviation (Indigo), 84 lakh shares of JSW Energy, 72 Lakh shares of Adani Green Energy, 53 Lakh shares of Asian Paints, and 35 Lakh shares of Adani Energy Solutions. In addition, mutual funds also accumulated small portions of Hindustan Zinc Ltd (HZL). The focus was on energy, and also on Eternal and Swiggy as beneficiaries of the problems at Zepto. ITC sell float got absorbed quite easily.

We now turn to major large cap selling by mutual funds in May 2025. The selling was visible in stocks as part of larger portfolio restructuring. Here are major sell candidates. There was heavy selling of 508 Lakh shares in Samvardhana Motherson International, 185 Lakh shares of Coal India Ltd, 150 lakh shares of NTPC Green Energy, 112 Lakh shares of Bank of Baroda, 31 lakh shares of Bajaj Housing, 19 Lakh shares of Godrej Consumer Products, 14 Lakh shares of Zydus Lifesciences, 12 lakh shares of Grasim Industries, and 11 lakh shares of Pidilite Industries. In addition, mutual funds sold smaller quantities in Polycab India Ltd. The underlying theme on sell side was taking profits off the table; leveraging the rally.

HOW MUTUAL FUNDS CHURNED MID-CAP STOCKS IN MAY 2025

Once the large cap list is completed, the stocks ranked 101st to 250th by market cap, qualify as mid-cap stocks. Here is a look at buying and selling in mid-caps in May 2025.

Let us first focus on mid-cap buying in May 2025. Overall, mutual funds added 541 Lakh shares of IDFC Bank, 353 Lakh shares of Steel Authority of India Ltd (SAIL), 196 Lakh shares of Union Bank of India, 169 Lakh shares of Bharat Heavy Electricals Ltd (BHEL), 134 Lakh shares of Paytm, 67 Lakh shares of Marico Ltd, 28 lakh shares of Glenmark Pharmaceuticals, 11 Lakh shares of Patanjali Foods, and 10 Lakh shares of Colgate Palmolive. In addition, mutual funds bought smaller quantities of Mazagon Dock Shipbuilders in May 2025.

We now turn to major mid-cap selling candidates during the month of May 2025. Mutual Funds sold 536 Lakh shares of FSM E-Commerce Ventures (Nykaa), 295 Lakh shares of Aditya Birla Fashion & Retail, 104 Lakh shares of Container Corporation Ltd, 36 Lakh shares of Coromandel International, 25 lakh shares of GIC RE, 19 lakh shares each of ACC Ltd, and 14 Lakh shares of Supreme Industries. In addition, the month of May 2025 also saw smaller quantities of selling in Cochin Shipyards, Hitachi Energy India, and MRF Ltd. The selling in mid-caps was relatively subdued in May 2025, and that could be more because fund action was concentrated on buying mid cap stories. After all, most mid-caps had corrected sharply from peak prices.

HOW MUTUAL FUNDS CHURNED SMALL CAP STOCKS IN MAY 2025

The stocks ranked 251st and lower are classified as small caps by AMFI; although stocks below ₹10,000 Crore in market cap are generally classified as micro-caps. Here is a gist of the buys and sells by MFs in May 2025.

In May 2025, mutual funds added 1,858 Lakh shares of Sagility India Ltd, 66 Lakh shares of Chambal Fertilizers & Chemicals Ltd, 53 Lakh shares of KFIN Technologies Ltd, 26 lakh shares of Simplex Infrastructure, 8 Lakh shares of Taj GVK Hotels, and 7 Lakh shares of Ravindra Energy Ltd. In addition, mutual funds also purchased smaller quantities of FIEM Industries, Paras Defence, E2E Networks Ltd, and Authum Investment & Infrastructure in May 2025.

Let us conclude our churn analysis with the small-cap selling in the month of May 2025. Mutual funds sold 364 Lakh shares of Utkarsh Small Finance Bank, 44 Lakh shares of Shipping Corporation of India, 25 Lakh shares of Camlin Fine Sciences, 19 Lakh shares of INOX Green Energy, 15 Lakh shares of Aeroflex Industries, 14 lakh shares of MOIL Ltd, and 7 lakh shares of Borosil Renewables. In addition, May 2025 also saw mutual funds selling smaller quantities in Heubach Colorants Ltd, Privi Specialty Chemicals, and Unimech Aerospace & Manufacturing Ltd.

Large cap buying was a lot more focused on specific sectoral stories, while for mid and small caps, it was bottom-up. Defence stocks did attract a lot of buying interest in May 2025.