How much did mutual funds invest in Adani’s shares?

Exposure to equity mutual funds (MFs), mainly through equity arbitrage, equity savings and passive funds, was 25,263 crore to the Adani group companies by December 31, 2022, according to data obtained from RupeeWest. Equity investments in arbitrage and equity savings schemes are partially used for hedging and passive funds that only mimic stock market indexes.

Adani Ports & SEZ and Adani Enterprises are part of the Nifty 50 Index, while Adani Green Energy and Adani Transmission are constituents of the Nifty Next 50 Index.

Active fund managers largely stayed away from the Adani group, except for Ambuja Cements, ACC and to a lesser extent, Adani Ports and Special Economic Zones.

Ambuja Cements, which was recently acquired by Adani Group, had the largest MF exposure 7,922 crores. After this Adani Ports and Special Economic Zone ( 7,786 crore), Adani Enterprises ( 4,549 core) and acc ( 3,662 crore). Mutual funds do not have equity exposure to other five Adani group companies (these five companies are accounted for together 1,300 crore of equity MF exposure).

The mutual fund exposure stood at 8% of the market cap of ACC and 7.6% of the market cap of Ambuja Cements as on December 31, 2022. This is 4.4% of the market cap of Adani Ports and Special Economic Zone.

Active bet of Quant MF

Very few MF schemes have made large active investments in Adani Group. Among equity schemes, Quant Large Cap’s scheme had 7.96% exposure in Adani Ports & SEZ. The Quant Tax plan held 7.7% of its plan assets for Ambuja Cements.

Taurus Large Cap, which is a small scheme with Assets Under Management (AUM) 34 crores, 6.1% of its plan assets were held by Adani Enterprises.

Out of these schemes, Quant Tax plan is the largest with AUM 6,179 crores.

Quant MF has made large active bets on Adani Ports and SEZ. 5-8% of his scheme’s AUM in Quant Large Cap, Quant ESG Equity Fund, Quant Flexi Cap Fund, Quant Focused Fund, Quant Absolute Fund, Quant Tax Plan, Quant Large & Mid Cap Fund and Quant Multi-Asset Fund I was in Ports and SEZ, by 31 December 2022.

The sharp rise in valuations of Adani Group shares over the past few years has prompted most active fund managers to stay away from the group, even though the weighting of group companies has gone up over the years as their share prices have risen Huh.

Prior to the current fall in stock prices, Adani Green Energy and Adani Total Gas traded at more than 700 times trailing 12-month price-to-earnings. Adani Enterprises and Adani Transmission trade at price-to-earnings multiples of 400-450 times on a trailing basis.

Before the correction, Adani Enterprises gave 135%, Adani Transmission 124%, Adani Total Gas 114% and Adani Green Energy 182% in one year.