Mutual funds’ holdings of auto sector stocks stood at a record low in April, finds a study by broking house Motilal Oswal Securities. The weightage of the auto sector touched a new low of 6.3 per cent (down 10 basis points over a month and 340 bps year-on-year), it said.

As a result, the sector is down to the seventh position in terms of mutual funds’ allocation — it was at the second position 12 months ago, according to the study.

During April 2019, the performance of mutual funds has not been satisfactory. According to the study, 60 per cent of the top-25 schemes closed lower in April. Mutual funds increased their weightage on technology, cement, healthcare, private banks and capital goods in April over March. However, they reduced holdings in PSU banks, utilities, NBFCs, oil & gas, autos, chemicals and infrastructure, the fund tracker of the brokerage revealed.

Private banks — the top sector holding of MFs — saw its weightage increase for the seventh successive month to a new high of 19.3 per cent (+10 bps m-o-m and 390 bps y-o-y). HDFC Bank was one of the preferred stocks among MFs in April, with net buying by 16 funds.

Private banks (19.3 per cent) led the sectoral holdings, followed by technology (9.1 per cent), NBFC (8.7 per cent) and oil & gas (7.9 per cent).

TCS’ value spikes

But TCS saw value increase of ₹2,270 crore last month, as the stock was up 12.7 per cent; the stock saw net buying by nine of the top-20 funds.

Indiabulls Housing Finance (23.6 per cent), Bharti Infra (15.8 per cent), Cipla (12 per cent), UltraTech (10.8 per cent) and JSW Steel (4.7 per cent) witnessed the highest net buying in April.

Among the top-20 funds, the highest m-o-m increase on equity value was seen in Mirae Asset Mutual Fund (3.9 per cent), Canara Robeco MF (3.6 per cent), Axis MF (3.1 per cent), Invesco MF (1.4 per cent) and SBI MF (1.1 per cent).

Top sectors where ownership of mutual funds vis-à-vis BSE-200 is at least 1 per cent higher are: capital goods (17 funds over-owned); healthcare (11 funds over-owned); cement (10 funds over-owned); private banks (nine funds over-owned); and retail (eight funds over-owned).

On the other hand, oil & gas (19 funds), NBFCs (16 funds), consumer (15 funds), technology (15 funds), and telecom (nine funds) stood under-owned by 1 per cent with respect to BSE-200.

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