MFs raise stake in infra, consumer, finance stocks ahead of Budget; 30 stocks in focus

Mutual Fund managers have lapped up top infrastructure, consumer and financial stocks ahead of the Budget 2020, December MF data shows.

The Indian market indices rose more than 12 percent in 2019 to new highs while the asset under management (AUM) stood at Rs 26.5 lakh crore as of December 2019, an increase of 10 percent from a year ago, data released by AMFI says.

Inflows into equity funds, including closed-ended schemes, jumped to Rs 4,432 crore in December from Rs 933 crore in the previous month.

Monthly net equity inflows have come off significantly from the peak of Rs 20,308 crore in November 2017. However, the underlying trend continues to be very healthy.

Fund managers were quick to spot stocks in the large, mid as well as smallcap spaces, most of which were from infrastructure, consumer and finance sectors that are likely to benefit the most from the Budget.

In the largecap space, mutual funds raised stakes in Ambuja Cement, DLF, Nestle India, Maruti Suzuki, UltraTech Cements, Godrej Consumer and Titan Company.

“Defence, banking, auto, infrastructure, and consumption will be the key sectors to watch out for in the Budget 2020. Banking, auto, and consumption will be in focus owing to the government constantly working towards passing on the benefits of interest rate cuts as well as addressing demand-side factors such as higher tax slabs (effectively lower net tax rate within the Rs 20 lakh bracket), boosting demand for consumption and the auto sector,” Vinay Pandit, Head of Institutional Equities, IndiaNivesh, told Moneycontrol.

Infrastructure is another area the government is focusing on through measures such as rural electrification, electricity for all, affordable housing, Green Energy Corridor, dedicated freight corridor and waterways among others. “We expect continued allocation to similar projects,” he said.

Finance Minister Nirmala Sitharaman provided an outline for the Rs 100-lakh-crore National Infrastructure Pipeline (NIP) on December 31.
A list of top 30 stocks, from ICICI Securities, that fund managers bought and sold in December:

Largecaps
Among the largecaps, fund managers raised stake in stocks like HDFC AMC, Ambuja Cements, DLF, Maruti Suzuki and Nestle India, which witnessed the highest buying in December.

One of the prime reasons for MF raising stake in asset- management companies is the sheer growth seen in the fund business. From Rs 10.5 lakh crore as of December-end 2014 to Rs 26.5 lakh crore at the end of December 2019, it has more than doubled in five years, a report said.

Largecap Dec

MidcapsIn midcaps, stocks such as Quess Corp, RBL Bank, Crompton Greaves Consumer, Motilal Oswal Financial Services and Escorts witnessed buying in December 2019.

Midcaps December
Smallcap 

In small caps, stocks like Can Fin Homes, Essel Propack, Suprajit Engineering, Welspun Corp and Narayana Hrudalaya witnessed the highest buying during the month.

Smallcap December

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