MF Update: Major Changes in equity MF holdings in January 2020
The frontline Indian equity indices are once again trading below their crucial level. For example, Nifty is trading below 12000 while Sensex is trading below 41000. What is leading to such a fall in the indices is heightening concerns around Coronavirus and its potential impact on the global economy. The coronavirus had started in the month of December and its impact was visible in the month of January. Nevertheless, Mutual funds held their ground and were reflected in inflows that picked up and the contribution of systematic investment plans (SIPs) scaling up to Rs 8530 crore every month.
Noteworthy changes in the sector
On a sequential basis, the weight of Telecom, Cement, Chemicals, Capital Goods, Healthcare, Consumer, NBFC, Technology and Retail increased in the month of January 2020. Oil & Gas, Banks (Private and PSU), Metals, Automobiles and Utilities, on the other hand, declined in the same period.
Telecom weight increased for the third successive month to hit an all-time high of 2.4 per cent of equity AUM. Oil & Gas weight hit a seven-month low of 7.3 per cent. As a result, the sector slipped to the fifth position in sector allocation of MFs down from 3rd in the month of December 2019.
Noteworthy changes in companies
As reflected in sector changes, Bharti Airtel saw a maximum increase in the value of stocks accumulated by MF in the month of January 2020. It saw an increase of Rs 5630 crore. Other important companies where MF increased their holdings were Infosys, L&T, Power Grid Corp and UltraTech Cement.