There are about 20 stocks in which fund managers along with financial institutions have raised their stake in every quarter more than doubled investors’ wealth in the last 1 year.
Indian markets witnessed a major reversal which put the raging bulls of the year 2017 on the back foot in the month of February 2018. Thanks to global volatility, investors who didn’t get the chance to dip into the equity pool in the year 2017 have the chance to use the opportunity.
Largecap stocks remained fairly stable but most of the small and midcaps suffered losses up to 40-50 percent as Nifty slipped over 6 percent from its all-time high of 11,171.55 recorded earlier in the month of January 2018.
The next big question is what to buy if there is a correction? Some investors would like to stick to their fundamental or technical approach but a sneak peek into what fund managers are doing with your money could also throw some interesting stock ideas.
There are about 20 stocks in which fund managers along with financial institutions have raised their stake in every quarter more than doubled investors’ wealth in the last 1 year.
Stocks which rose up to 900 percent include names like Yuken India, Jindal Steel & Power, Polaris Consulting, Escorts, Nocil, Tata Metaliks, MM Forging, Dewan Housing, Jamna Auto, L&T Infotech Ltd, Jaiprakash Associates, NCL Industries, Aegis Logistics, Sterling Tools, Subros, Hatsun Agro, Tata Global Beverages etc. among others.
The domestic institutional investors have been the biggest beneficiaries of retail investors’ money in the year 2017 and the trend continued in the year 2018 as well.
Investors have pumped over Rs 1 lakh crore into mutual funds in January, driving the industry assets base to an all-time high of Rs 22.41 lakh crore, Amfi data showed.
In January 2018, Equity funds (including ELSS) witnessed monthly net inflows of Rs 15,390 crore, down 4 percent MoM. “The fall in number could be because of investors turning cautious ahead of the Union Budget 2018-19,” rating agency ICRA said in a report.
“There has been a sharp recovery in the global markets, but India has seen huge selling pressure on every rally due to the recent turn of events domestically, one after another,” Devang Mehta, Head – Equity Advisory at Centrum Wealth Management told Moneycontrol.
“In hindsight, markets had a dream run till January end and a correction in valuation was overdue. We don’t see any reason to panic, as corrections are part and parcel of any bull market. It will, in fact, make valuations look better and help investors sitting on the sidelines to deploy funds gradually,” he said.
Rather than focusing on the index targets for the next 12 months, investors should focus on individual stocks which they can hold for the longer term. Investors should focus on themes which are likely to be a big beneficiary of the rise in the Indian economy and can support growth for the next two to three years.
Some of the sectors which are likely to benefit the most from the rise in economic cycle include Infrastructure, Railways, Aviation, and telecom.
Change in December quarter:
Stocks in which domestic financial institutions increased their stake and has also more than doubled investors wealth in the December quarter include companies like Butterfly Gandhimathi Appliances Ltd, Yuken India Ltd, Shaily Engineering Plastics Ltd, Sonata Software Ltd, Polaris Consulting & Services Ltd, and Bhansali Engineering Polymers Ltd.
MF heavy stocks:
Most of the stocks in which MF managers hold a stake in double-digit saw some correction in the December quarter to till data. But, fund managers used the fall or correction to accumulate stocks.
Stocks in which fund managers/financial institutions hold double-digit stake include names like Equitas Holdings, Tata Motors DVR, Max Financial Services, Ashoka Buildcon, NCC, Tata Chemicals, ICICI Bank, Oriental Cement, Blue Star, Apar Industries etc. among others.
