Equity inflows accelerate; Technology steals the limelight By Motilal Oswal Fund Folio Report
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According to Motilal Oswal Financial Services, Equity AUM for domestic MFs (including ELSS and index funds) increased 1.8% MoM to INR20.4t in Aug’23 despite a weak market sentiment (Nifty down 2.5% MoM). Equity scheme sales picked up at INR486b (+16.8% MoM); at the same time, redemptions decreased 19.6% MoM to INR265b. Consequently, net inflows rose significantly to INR221b in Aug’23 from INR87b in Jul’23. Total AUM for the MF industry rose 0.6% MoM to INR46.6t in Aug’23, driven by a MoM increase in AUM for equities (INR367b), income (INR96b), and arbitrage (INR82b) funds. Conversely, AUM for liquid/other ETF funds declined INR232b/INR77b MoM.
AUM: Up 0.6% MoM to INR46.6t; equity inflows accelerate
Total AUM for the MF industry rose 0.6% MoM to INR46.6t in Aug’23, driven by a MoM increase in AUM for equities (INR367b), income (INR96b), and arbitrage (INR82b) funds. Conversely, AUM for liquid/other ETF funds declined INR232b/INR77b MoM. Equity AUM for domestic MFs (including ELSS and index funds) increased 1.8% MoM to INR20.4t in Aug’23 despite weak market sentiment (Nifty down 2.5% MoM). Equity scheme sales picked up at INR486b (+16.8% MoM); at the same time, redemptions decreased 19.6% MoM to INR265b. Consequently, net inflows rose significantly to INR221b in Aug’23 from INR87b in Jul’23.
Top 20 funds: Value of equity MFs increases 0.9% MoM and 22.1% YoY
Total equity value for the top 20 AMCs increased 0.9% MoM (+22.1% YoY) in Aug’23 vs. a 2.5% MoM decline (+8.4% YoY) for the Nifty. Among the Top 10 funds, the highest MoM rise was seen in Mirae Asset Mutual Fund (+3.5%) followed by Nippon India Mutual Fund (+3.1%), DSP Mutual Fund (+1.8%), HDFC Mutual Fund (+1.6%), and ICICI Prudential Mutual Fund (+1.1%).
Sector wise weightage: MoM increase seen in Technology, Metals and Cons. Durables
In Aug’23, MFs showed an interest in Technology, Metals, Consumer Durables, and Chemicals leading to a MoM rise in their weights. Conversely, Private Banks, PSU Banks, Oil & Gas, Consumer, and NBFCs saw a MoM moderation in weights. Private Banks (19.2%) was the top sector holding for MFs in Aug’23, followed by Technology (9.6%), Autos (8.2%), Capital Goods (7.3%), and Consumer (6.8%). Media, Textiles, Chemicals, and Technology were the top sectors to witness an increase in value MoM
Sectoral allocation of funds: Consumer, Oil & Gas, and Private Banks under-owned
The top sectors where MF ownership vis-à-vis the BSE 200 are at least 1% lower: Consumer (20 funds under-owned), Oil & Gas (19 funds underowned), Private Banks (15 funds under-owned), Technology (12 funds under-owned), and Utilities (11 funds under-owned).
The top sectors where MF ownership vis-à-vis the BSE 200 are at least 1% higher: Capital Goods (15 funds over-owned), Healthcare (15 funds overowned), Chemicals (13 funds over-owned), Automobiles (11 funds over-owned), and NBFCs (10 funds over-owned).
Nifty-50 snapshot: MFs net buyers in 68% of the stocks
The highest MoM net buying in Aug’23 was observed in Britannia (+17%), UPL (+11%), Hero MotoCorp (+9.8%), Grasim Inds (+8.7%), and Wipro (+8.6%)
Nifty Midcap-100 snapshot: MFs net buyers in 51% of the stocks
The highest MoM net buying in Aug’23 was seen in Union Bank, Coforge, Aditya Birla Capital, L&T Finance Holdings, and Petronet LNG
Nifty Smallcap-100 snapshot: MFs net buyers in 67% of the stocks
The highest MoM net buying in Aug’23 was witnessed in Piramal Pharma, Suzlon Energy, BSE, MRPL, and Jubilant Ingrevia.
Top schemes and NAV change: 14 of the top 25 schemes close higher MoM
Among the top 25 schemes by AUM, the following reported the highest MoM increase: Nippon India Small Cap Fund (+4.7% MoM change in NAV), Nippon India Growth Fund (+4.1% MoM), HDFC Small Cap Fund (+3.4% MoM), Kotak Emerging Equity Fund (+3.4% MoM), and Nippon India Multi Cap Fund (+3% MoM).
Value surprise: Maximum MoM decline seen in financial stocks
In Aug’23, the stocks that saw the maximum MoM increase in value were Coforge, Infosys, M&M, Interglobe Aviation, Zomato, Maruti Suzuki, Gland Pharma, Solar Industries, Persistent System, and Cipla. Stocks that witnessed the maximum decline in MoM value were SBI, ICICI Bank, HDFC Bank, Reliance Industries, ITC, Cummins India, TCS, Kotak Mahindra Bank, Bajaj Finance, and Ashok Leyland.
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