Inflows into equity mutual funds for December 2022 came in at ₹73 billion (bn) as against ₹22.6 bn recorded in November 2022.
This is more than three-fold growth in inflows, which came at a time when benchmark indices Sensex and Nifty fell 4%.
The inflows also come at a time when the primary market has dried up. There aren’t many IPOs coming up at present, but companies are waiting for the right time to launch their offers.
The net assets under management (AUM) of the mutual fund industry stood at ₹39.9 trillion (tn) as on 31 December 2022, down from ₹40.4 trillion last month.
Within the equity category, smallcap funds saw the biggest inflows at ₹22.5 bn, while the largecap fund segment saw outflow of ₹0.3 bn.
In November 2022, largecap funds did record their worst outflows in 22 months at ₹10.4 bn.
Debt oriented funds saw net outflows of ₹219.5 bn in December 2022. Market experts said this was on the cards as debt funds see outflows at the end of a year, as corporates use the funds to pay advance tax for the year.
Note that debt funds witnessed outflows in five out of last year’s twelve months. The pace of outflows was magnified in some months in between.
Inflows in the debt fund segment has remained volatile for quite some time now. They could stabilise once the RBI rate hikes stabilise.
Now coming to SIPs…
Inflows through systematic investment plans (SIP) again rose to a record and stood at ₹135.7 bn. This compared with previous month’s inflows of ₹133.1 bn.
In calendar year 2022, SIP inflows averaged more than ₹125 bn per month.
Let’s take a look at the stocks that mutual funds traded the most during this period…
Top Stocks Sold by Mutual Funds in December 2022
Largecaps: Indian mutual funds trimmed their positions in largecap stocks such as ICICI Bank, HCL Technologies, and Axis Bank.
HCL Tech has seen heavy selling by mutual funds for the past few months. Same for ICICI Bank. Mutual funds have trimmed their holdings in both these bluechips for three consecutive months now.
Last week, HCL Tech trimmed its revenue growth and margin guidance for FY23, despite posting strong numbers for the December 2022 quarter.
Midcaps: From the midcap space, mutual funds offloaded Narayana Hrudayalaya, Gujarat Gas, Ramco Cements, and Voltas.
Smallcaps: Amara Raja Batteries, Praj Industries, and Eris Lifesciences saw maximum selling by MFs from the smallcap space in December 2022.
EV batter maker Amara Raja Batteries did see increased buying in November 2022 before mutual funds decided to sell some stake.
Top Stocks Bought by Mutual Funds in December 2022
Largecaps: Coming to buying, HDFC, Reliance Industries, and Maruti Suzuki witnessed massive inflows.
Reports state that these three stocks received inflows worth ₹60 bn from mutual funds in December 2022.
Midcaps: From the midcap space, mutual funds bought shares of Ajanta Pharma, Jindal Stainless, Max Financial, and PFC.
Smallcaps: Sapphire Foods, GMM Pfaudler, and KFin Technologies were the top smallcap buys.
Top Equity Mutual Funds in December 2022
Here is the list of top 10 mutual fund houses as per their equity asset under management (AUM) as of December 2022.
What India’s Top Mutual Funds Bought and Sold in December 2022
SBI Mutual Fund
India’s largest equity fund held ₹4,660 bn in equities as of December 2022. The November 2022 figure was ₹4,748 bn.
The top equity holdings of the fund include ICICI Bank, Reliance Industries, and HDFC Bank.
Here’s what SBI Mutual Fund bought and sold in December 2022.
ICICI Prudential Mutual Fund
ICICI Prudential Mutual Fund was the second largest equity fund house with ₹2,418 bn in equities as of December 2022. The same figure in the month of November 2022 was ₹2,453 bn.
The top three equity holdings of ICICI Prudential Mutual Fund include ICICI Bank, HDFC Bank, and Infosys.
Here’s what the fund bought and sold in December 2022.
HDFC Mutual Fund
Following ICICI Prudential Mutual Fund we have HDFC Mutual Fund with ₹2,172 bn in equities as of December 2022. The November 2022 figure was ₹2,204 bn.
The top five equity holdings of the fund include ICICI Bank, HDFC Bank, State Bank of India, Infosys, and Reliance Industries.
Here’s what HDFC Mutual Fund bought and sold in December 2022.
Final words…
Data available shows that ahead of the results season, Indian mutual funds offloaded or at least reduced exposure from IT stocks.
Infosys, HCL Technologies and Tech Mahindra witnessed the maximum outflows.
Meanwhile, banking stocks saw some major reshuffling with HDFC Bank, ICICI Bank and Axis Bank changing counters.
As covid worries were once again back, Lupin and IPCA Labs were the top pharma picks of mutual fund managers. Whether these companies will stay tall in case of any Covid scare, only time will tell…
Going into 2023, industry experts say that 2023 will be a much better year for the mutual fund industry as investors look to continue their momentum via SIPs.
It is difficult to predict exactly what will happen in 2023, as it can be affected by a variety of factors. However, it is expected that the mutual fund industry will continue to grow as more investors become aware of the benefits of mutual funds and as the Indian economy continues to develop.
How the mutual fund buying and selling trend pans out in the month of January 2023 remains to be seen. We will keep you updated on all the developments from this space.
Stay tuned.
PS: The above piece relies on data from PersonalFN. PersonalFN is a Mumbai based personal finance firm offering Financial Planning and Mutual Fund Research services.
Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such.
This article is syndicated from Equitymaster.com
