The Hindu Business Line : Index heavyweights are fund managers’ favourites

Chennai, Dec. 12 Index heavyweights such as Reliance Industries, L&T and ICICI Bank continued to be the most popular stocks among equity fund managers in November 2007. Reliance Industries, already held by 255 funds, in October saw a rise in the number of funds holding stakes in it, to 260.

While L&T figured across 225 schemes, ICICI Bank was held by 209 schemes. Though several funds saw their exposure to Reliance Industries climb over the 10 per cent limit, they continued to hold on to the stock — despite the stock climbing 128 per cent in the past year.

Sector Preferences

Stocks that entered the most popular list in November were Kotak Mahindra Bank, Mudra Port, Jindal Steel & Power and GAIL. It is worth mentioning that the Bank of Baroda stock, which entered the top fifty in September, has since appreciated by 45 per cent.

In terms of sector preferences, banks continued to be in the good books of funds with ICICI Bank being the preferred one followed by SBI and HDFC Bank. Frontline IT stocks turned value picks, as many of them bounced off their 52-week low. Funds seem to have accumulated Infosys Technologies and TCS in November, while shedding MphasiS and HCL Technologies, the latter moved out of the top-50 stocks. The number of funds holding Bharti Airtel has declined and the number of schemes holding 5 per cent stakes in Bharti Airtel and Reliance Communication fell.

Within energy, GAIL moved into the top fifty and the stock price has appreciated by close to 25 per cent since the beginning of December. Suzlon Energy and Tata Power were added to the portfolio of 18 and 9 schemes respectively.

In all, 100 schemes had Tata Power in their November portfolio. The IPO of Mundra Port & Special Economic Zone appears to be a hit with fund managers, with 96 schemes subscribing to this offer.