Mutual funds continued with the profit-booking approach for the seventh consecutive month in January as the market touched new highs, data shows.
Along with the benchmarks BSE Sensex and the Nifty50, midcap, smallcap, metal, IT, bank and auto indices more than doubled from the lows seen in March 2020.
Equity and equity-oriented mutual fund schemes saw an outflow of Rs 9,253 crore in January 2021, taking the seven-month outflow to Rs 42,250 crore, the Association of Mutual Funds in India (AMFI) data shows. The flow through systematic investment plan (SIP) remained strong at Rs 8,023 crore in January, though was slower than Rs 8,418 crore in the previous month.
“January 2021 saw measured maturity-driven redemptions led by smart, goal-based investing and the desire to book profits with equity indices reaching all-time high,” AMFI Chief Executive NS Venkatesh said.
Inflows continued via the SIP route, as seen from the rising number of new registrations coupled with a robust monthly contribution. “The mutual fund industry AAUMs breached an all-time high at Rs 31.84 lakh crore,” he added.
Mutual funds made fresh buy into 10 stocks and moved out from four. Initial public offerings (IPOs) remained the hot favourites as there was huge buying in Indigo Paints, Home First Finance Company and Indian Railway Finance Corporation and also Stove Kraft.
Also read: Mutual Funds Bought And Sold These 10 Stocks Each From Large, Mid And Smallcap Space In January
Indigo Paints saw the highest response from investors as 18 mutual fund houses acquired Rs 143.28 crore worth of shares in the fifth-largest decorative paint company in India in terms of revenue as of FY20.
A large amount of buying was also seen in Indian Railway Finance Corporation, wherein MFs bought Rs 927 crore worth of shares, while asset management companies (AMCs) took positions worth Rs 117.82 crore in the housing finance firm Home First Finance Company India and Rs 50 crore in Stove Kraft.
Mutual funds also made fresh buys into chemical companies Balaji Amines, and Kanchi Karpooram, Kirloskar Industries, Mangalore Chemicals & Fertilizers, SIRCA Paints and Wendt (India), which makes abrasive grinding wheels and tools.
On the other side, they completely exited Acrysil, BL Kashyap & Sons, NR Agarwal Industries and Technocraft Industries (India).
Kirloskar Industries, Balaji Amines, Indigo Paints, Mangalore Chemicals & Fertilizers and Acrysil shares have done well since the beginning of 2021, rallying 49-91 percent since January 1, 2021.
SIRCA Paints India, Stove Kraft, BL Kashyap & Sons and Technocraft Industries shares gained 14-28 percent, while Home First Finance, Indian Railway Finance Corporation, Wendt (India) and NR Agarwal Industries have reported muted performance, so far, in 2021.
In the Nifty50 space, the highest buying by AMCs was seen in Asian Paints, Axis Bank, Bajaj Finance, Dr Reddy’s Labs, HDFC, JSW Steel, L&T, NTPC and Nestle India.
Adani Ports, Bajaj Finserv, Divis Labs, GAIL, Hero MotoCorp, Hindalco Industries, ICICI Bank, IOC, ITC, ONGC, Power Grid Corporation of India, TCS and Tata Motors witnessed highest selling.
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