Top 5 Stocks Mutual Funds Bought and Sold in October 2021

Bullish market environment continued to attract investors into equity mutual funds in October 2021. This trend has been going on for quite some time now.

Inflows into equity funds came in at Rs 52.2 bn in October 2021. This marked the eighth consecutive monthly net infusion.

Although it must be noted that net inflows were lower compared to September 2021. Could this be a result of investors booking profits with valuations running ahead?

Maybe.

In September, net inflows stood at Rs 86.8 bn, data with the Association of Mutual Funds in India (AMFI) shows.

Equity schemes have been witnessing a net inflow since March this year and the segment has received net inflows to the tune of Rs 737.7 bn during this period.

Before this, such schemes had witnessed outflows for back-to-back eight months starting July 2020.

October's inflows pushed average assets under management (AUM) of the mutual fund industry to an all-time high of Rs 38.2 lakh crore.

Within the equity segment, almost all categories saw net inflows, except the value and equity-linked saving scheme (ELSS) categories in October.

The fund of funds, index funds and ETFs category also reported positive flows.

On top of all this, monthly SIP contribution too reached an all-time high at Rs 105.2 bn from Rs 103.5 bn in September 2021.

In the month of September, a major contribution came from systematic investment plans (SIPs) and the trend continued in October.

The number of SIP folios increased from 448.98 lakhs in September 2021 to 464.31 lakhs in October 2021, a monthly net accretion of 15.33 lakh SIP folios.

Indian equities' record run is finding strong support from retail mutual fund investors with SIP being the preferred mode. As markets are trading at record high levels with no valuation concerns whatsoever, investors with low appetite have been encouraged to turn towards mutual fund SIPs.

So, with markets trading near record high, should you stop your SIP and book profits?

Let us take a look at which stocks mutual funds traded in the most during this period...

Top Stocks Sold by Mutual Funds in October 2021

Indian mutual funds trimmed their positions in largecap stocks such Bharti Airtel, State Bank of India, Kotak Mahindra Bank, and Reliance Industries.

They also sold stocks of IRCTC, Devyani International, Sun TV, and Dr Lal PathLabs.

Apart from these, they also reduced stakes in Tata Elxsi, Alkem Laboratories, Godrej Properties, and Petronet LNG.

The reduction in these companies' stakes may be mainly to take some profits off the table in an overheated market.

Top Stocks Bought by Mutual Funds in October 2021

Coming to buying, ICICI Bank, ICICI Lombard General Insurance, Infosys, and HCL Technologies witnessed massive inflows.

Other stocks which witnessed buying in the month of October are Delta Corp, Sona BLW Precision, Gokaldas Exports, and The India Cements.

With stretched market valuations, fund managers focused on stocks which are cheaper than their peers and with incremental earnings growth.

Top Equity Mutual Funds in October 2021

Her is the list of top 10 mutual fund houses as per their equity asset under management (AUM) as on October 2021.

Top 10 Equity Mutual Funds as per AUM

Top Fund Houses	Equity AUM (Rs bn)
SBI Mutual Fund	3,604.92
ICICI Prudential Mutual Fund	2,019.91
HDFC Mutual Fund	1,808.72
Nippon India Mutual Fund	1,426.84
UTI Mutual Fund	1,404.46
Axis Mutual Fund	1,374.75
Kotak Mutual Fund	1,201.83
Aditya Birla SL Mutual Fund	1,104.84
Mirae Asset Mutual Fund	856.11
DSP Mutual Fund	657.41

Data Source: ACE MF, PersonalFN Research

What India's Top Mutual Funds Bought and Sold in October 2021

• SBI Mutual Fund

  India's largest equity fund held Rs 3,605 bn in equities as of October 2021.

  The top four equity holdings of the fund include ICICI Bank, State Bank of India, Infosys, and HDFC Bank.

  Here's what SBI Mutual Fund bought and sold in October 2021.

  New Buys	Value as on 31 October 2021 (Rs m)
  Aditya Birla Sun Life AMC Ltd.	1,991.80
  Gokaldas Exports Ltd.	962.30
  FSN E-Commerce Ventures Ltd.	750.00
  K.P.R. Mill Ltd.	221.20
  Delta Corp Ltd.	147.00
  GMR Infrastructure Ltd.	8.20
  Aditya Birla Fashion and Retail Ltd.	2.10
  Complete Sell	Value as on 30 September 2021 (Rs m)
  Kewal Kiran Clothing Ltd.	410.00
  Firstsource Solutions Ltd.	208.20
  Mrs. Bectors Food Specialities Ltd.	80.50
  Deepak Nitrite Ltd.	79.40
  Gujarat Gas Ltd.	78.90
  Amara Raja Batteries Ltd.	11.20
  Ipca Laboratories Ltd.	6.00
  Avanti Feeds Ltd.	4.40
  Top Increase / Decrease in Stakes	Change in No. of Shares
  Bharat Heavy Electricals Ltd.	1,249,500
  Max Financial Services Ltd.	91,000
  Sun TV Network Ltd.	306,003
  Indian Railway Catering And Tourism Corporation Ltd.	-157,625
  Nippon Life India Asset Management Ltd.	-500,800
  IRB Infrastructure Developers Ltd.	-7,600,000

  Data Source: ACE MF, PersonalFN Research

• ICICI Prudential Mutual Fund

  ICICI Prudential Mutual Fund stands as the second largest equity fund with Rs 2,020 bn in equities as of October 2021. The same figure in the month of September was Rs 1,982 bn.

  The top three equity holdings of ICICI Prudential Mutual Fund include ICICI Bank, Bharti Airtel, and Infosys.

  Here's what the fund bought and sold in October 2021.

  New Buys	Value as on 31 October 2021 (Rs m)
  Aditya Birla Sun Life AMC Ltd.	1,991.80
  Gokaldas Exports Ltd.	962.30
  FSN E-Commerce Ventures Ltd.	750.00
  K.P.R. Mill Ltd.	221.20
  Delta Corp Ltd.	147.00
  GMR Infrastructure Ltd.	8.20
  Aditya Birla Fashion and Retail Ltd.	2.10
  Complete Sell	Value as on 30 September 2021 (Rs m)
  Kewal Kiran Clothing Ltd.	410.00
  Firstsource Solutions Ltd.	208.20
  Mrs. Bectors Food Specialities Ltd.	80.50
  Deepak Nitrite Ltd.	79.40
  Gujarat Gas Ltd.	78.90
  Amara Raja Batteries Ltd.	11.20
  Ipca Laboratories Ltd.	6.00
  Avanti Feeds Ltd.	4.40
  Top Increase / Decrease in Stakes	Change in No. of Shares
  Bharat Heavy Electricals Ltd.	1,249,500
  Max Financial Services Ltd.	91,000
  Sun TV Network Ltd.	306,003
  Indian Railway Catering And Tourism Corporation Ltd.	-157,625
  Nippon Life India Asset Management Ltd.	-500,800
  IRB Infrastructure Developers Ltd.	-7,600,000

  Data Source: ACE MF, PersonalFN Research

• HDFC Mutual Fund

  Following ICICI Prudential Mutual Fund we have HDFC Mutual Fund with Rs 1,809 bn in equities as of October 2021.

  It must be noted that HDFC Mutual fund decreased its exposure in October. The total equities of the fund stood at Rs 1,815 bn in September 2021.

  The top five equity holdings of the fund include ICICI Bank, State Bank of India, Infosys, HDFC Bank, and L&T.

  Here's what HDFC Mutual Fund bought and sold in October 2021.

  New Buys	Value as on 31 October 2021 (Rs m)
  Aditya Birla Sun Life AMC Ltd.	776.60
  FSN E-Commerce Ventures Ltd.	750.00
  Paras Defence And Space Technologies Ltd.	491.90
  PCBL Ltd.	450.40
  IDFC Ltd.	438.70
  TVS Motor Company Ltd.	32.50
  The India Cements Ltd.	29.30
  Oberoi Realty Ltd.	14.60
  Colgate-Palmolive (India) Ltd.	0.50
  Complete Sell	Value as on 30 September 2021 (Rs m)
  Amara Raja Batteries Ltd.	374.90
  Edelweiss Financial Services Ltd.	364.20
  Indiabulls Housing Finance Ltd.	116.30
  Inox Wind Energy Ltd.	50.90
  Indiamart Intermesh Ltd.	45.20
  Manappuram Finance Ltd.	35.50
  NCL Industries Ltd.	17.70
  National Aluminium Company Ltd.	7.90
  SRF Ltd.	1.40
  Top Increase / Decrease in Stakes	Change in No. of Shares
  Indus Towers Ltd.	730,800
  Interglobe Aviation Ltd.	89,000
  Indraprastha Gas Ltd.	1,220,125
  Steel Authority Of India Ltd.	-2,869,000
  NMDC Ltd.	-4,107,100
  ABB Power Products and Systems India Ltd.	-40,500

  Data Source: ACE MF, PersonalFN Research

There was a risk of possible third wave of Covid-19 lingering on India's growth prospects. But due to resumption of business activities and strong vaccination drive, the growth outlook has improved.

This has helped Indian share markets to touch new all-time highs on expectation of economic recovery.

In October, mutual funds increased exposure in companies with no input cost pressures. This is because Indian companies are facing higher raw material costs for the past couple of months.

Fund managers said companies' operating margins are under pressure due to supply chain disruptions and strong commodity prices.

Mutual funds also lapped up recently listed shares of Aditya Birla Sun Life AMC and FSN E-Commerce, the parent company of Nykaa.

The IPO of Nykaa got massive investments worth Rs 8 bn from domestic mutual funds. The fact that Nykaa is a profitable business and has high growth potential allowed mutual funds to invest in Nykaa despite its steep valuations.

Mutual funds going big on IPOs is the trend we are seeing since months now. In some cases, like Zomato, Sona Comstar, and Nuvoco Vistas, they invested 20-40% of the issue size.

How the mutual fund buying and selling trend pans out in the month of November remains to be seen.

We will keep you updated on all the developments from this space.

Stay tuned.

Happy investing!

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.