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India’s biggest MF just bought & sold over 1 cr shares of these firms

The benchmark BSE Sensex advanced 3.78 per cent, or 1,461 points to 40,129 in October.

ETMarkets.com|
Updated: Nov 11, 2019, 04.27 PM IST
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BSE Midcap and Smallcap index gained 5.39 per cent and 2.94 per cent, respectively, during the month.
HDFC Asset Management, India’s largest mutual fund house by assets, bought select FMCG, public sector companies and pharma players with both hands in October as September quarter earnings season peaked.

The fund house purchased more than 1 crore shares each in FMCG major ITC and India's largest hydropower producer NHPC.

ITC last month posted a 37.06 per cent increase in consolidated net profit at Rs 4,173.72 crore for September quarter, while NHPC is scheduled to announce its number later on Monday.

Stock brokers are positive on ITC. Anand Rathi Financial Services in a November 6 report said: “With strong operating cash flows, continuous capacity expansions across businesses and a healthy balance sheet, we continue to remain positive on ITC over medium to longer term perspective. We maintain a ‘buy’ rating on the stock with a target price of Rs 352 per share.”

HDFC Mutual Fund’s other top buys in October included SBI, Coal India, REC, Bajaj Corp, Bharti Infratel, Neyveli Lignite, Cipla, Ambuja Cement, Federal Bank, Texmaco Rail, Tata Steel, Lupin, Aurobindo Pharma, Firstsource Solutions and J Kumar Infraprojects, among others.

The fund house added 2.50 to 95 lakh additional shares of these companies last month.

SBI, the country’s biggest lender by assets, reported a nearly six-fold rise in Q2 profit at Rs 3,375.40 crore, supported by a partial stake sale in life insurance venture.

HDFC Securities earlier in November gave a ‘buy’ call to SBI with a target price of Rs 312.

HDFC AMC also added shares of infra players IRB Infra (18 lakh shares), Larsen and Toubro (11 lakh shares), Dilip Buildcon (6.51 lakh shares) and PNC Infratech (3.89 lakh shares). Besides, it further bought Sun Pharma (23 lakh shares), Grasim Industries (21 lakh shares), Bharat Electronics (20 lakh shares), GAIL (19 lakh shares), Indian Hotels (19 lakh shares), Delta Corp (17 lakh shares), Kirloskar Ferrous (16 lakh shares) and Mishra Dhatu Nigam (16 lakh shares).

Sun Pharmaceutical Industries turned around in Q2 with a net profit of Rs 1,064.09 crore. The company had posted a consolidated net loss of Rs 269.6 crore in the same period last financial year.

From among large cap firms, the fund house added nearly 6 lakh shares of the InusInd Bank and 3.87 lakh shares of Bajaj Electricals. Financial firms including HDFC, Axis Bank, Kotak Mahindra Bank and YES Bank also drew some interest of the AMC.

It further increased its exposure in Bajaj Finance, UltraTech Cement, Asian Paints, Bharti Airtel, NTPC, Dr Reddy’s Labs, ONGC, Maruti Suzuki, Zee Entertainment, M&M, Titan, HCL Technology and Adani Ports.

The benchmark BSE Sensex advanced 3.78 per cent, or 1,461 points to 40,129 in October amid robust inflows by foreign institutional investors during the month. On the other hand, BSE Midcap and Smallcap index gained 5.39 per cent and 2.94 per cent, respectively, during the month.

Among the stocks the fund house offloaded during the month included over 1 crore shares each in Infosys, ICICI Bank, and BHEL.

It also sold over 10 lakh shares each in Edelweiss Financial, Reliance Industries, SAIL, Ashok Leyland, Adani Power, HPCL, BPCL and Vedanta during the month gone by, according to data available with Ace Mutual Fund.

Commenting on general market trend, Kashyap Pujara, head of research at Axis Capital in an interaction with ETNow said, “What we are seeing as a trend is that not only have midcap valuations have become extremely supportive but also we have seen participation of institutions on midcaps go down by 600 bps. It is going to be a U-shaped recovery for the midcaps. They tend to do well when GDP growth surprises and we will see GDP recovery going forward. As the recovery gets a bit broad-based, we will definitely see midcaps outperforming the largecaps over the next two to three years.”
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