The NFO collection of Rs 206.2 billion was more than the combined inflows in the last 3 months.
The huge jump in New Fund Offers (NFOs) boosted the inflows of Equity Mutual Funds in the month of December 2021.
The NFO collection of Rs 206.2 billion was more than the combined inflows in the last 3 months. However, the flow in December was below the record flow in July. To put things in context, in the last 6 months, NFO inflows have exceeded Rs 800 billion.
What has happened is that investors are getting used to the buying trend on every correction. This led investors to allocate Rs 250.8 billion in equity mutual funds in December 2021, the highest ever monthly net inflows to such funds.
Net investment in the previous month stood at Rs 116.1 billion. This is also the 10th consecutive month of investment. Since March 2021, equity funds saw a cumulative net inflow of Rs 1,104.6 billion.
Systematic Investment Plans (SIPs) His collection increased to Rs 113.1 billion in December 2021, from Rs 110.1 billion in November. The number of mutual fund SIP accounts stood at 49m as of December 2021 as compared to 47.8m in November.
This was for the first time in September 2021 when SIPs crossed the 100 bn mark. This trend has now extended till the fourth month. Since the market has been volatile for the past two months, keeping investors on edge due to the Omicron variant, they are allocating more towards their SIP contributions.
Investors stick to their process by following their SIPs, which only show their fast and long-term wealth creation journey. Since the beginning of this financial year, monthly SIP inflows have shown a secular growth. From Rs 85.7 billion in April 2021, this figure has now increased to Rs 113 billion.
While all is well on the equity front, debt funds are telling another story. Redemptions of Rs 491.5 billion from debt funds reduced the assets under management (AUM) of the industry marginally to Rs 37,920 billion in December 2021 from Rs 38,450 billion in the previous month.
Reportedly, debt funds saw outflows due to quarter-end requirements and investors are likely to be disappointed with poor returns and a hike in interest rates in the coming year.
Let’s take a look at which stocks traded the most in mutual funds during this period…
Top Stocks Sold by Mutual Funds in December 2021
Largecap: Indian mutual funds reduced their positions in largecap stocks such as PB Fintech, Macrotech Developers, Hindustan Zinc, Nykaa and Eicher Motors.
Adani Green Energy also saw heavy selling.
Midcap: From the midcap space, mutual funds sold Vodafone Idea, Yes Bank, Bank of India and Indian Energy Exchange (IEX).
small hats: RBL Bank, PNB Housing Finance, Latent View and BSE saw maximum selling by MFs from the smallcap space in December 2021.
Interestingly, BSE also made it to the list last month. Mutual funds are reducing their stake after a sharp jump in stocks.
Top Stocks Bought by Mutual Funds in December 2021
Largecap: To buy, IRCTC, Indus Towers, Paytm, and Tata Power saw a massive influx from the largecap space.
Midcap: From the midcap space, fund managers loaded with CRISIL, Indiamart Intermesh, Indian Hotels, L&T Finance and Tata Communications.
small hats: HFCL, Data Patterns, Graphite India and Go Fashion were top smallcap buys.
Top Equity Mutual Funds in December 2021
Here is a list of top 10 mutual fund houses according to their Equity Assets Under Management (AUM) as of December 2021.
What are India’s top mutual funds bought and sold in December 2021?
• SBI Mutual Fund
India’s largest equity fund had Rs 3,702 billion in equities as of December 2021.
The fund’s top four equity holdings include HDFC Bank, Reliance Industries, Infosys and ICICI Bank.
Here’s what SBI Mutual Fund bought and sold in December 2021.
• ICICI Prudential Mutual Fund
ICICI Prudential Mutual Fund stands as the second largest equity fund with Rs 2,053 billion in equities as of December 2021. In the month of November, this figure was Rs 1,995 billion.
ICICI Prudential Mutual Fund’s top three equity holdings include ICICI Bank, Infosys and Bharti Airtel.
Here’s what the fund bought and sold in December 2021.
• HDFC Mutual Fund
After ICICI Prudential Mutual Fund we have HDFC Mutual Fund with Rs 1,837 billion in equity as of December 2021.
The fund’s top five equity holdings include ICICI Bank, State Bank of India, Infosys, HDFC Bank and Reliance Industries. It is also doing well in L&T.
Here’s what HDFC Mutual Fund bought and sold in December 2021.
As rightly pointed out by Rahul Shah, Co-Head of Research at Equitymaster, it is always better to risk only 50% and keep the rest in FD or cash. This strategy came to the rescue in November as well as in December 2021.
Investors who had money waiting, used the market correction as an opportunity and allocated it towards equity mutual funds.
2021 was the year of the NFO. Since the industry has added Rs 7 lakh crore to their asset base, investors fell in love with mutual funds. Asset Management Companies (AMCs) launched over 100 NFOs offering various investment ideas, leading to further increase in AUM.
All this happened because of good sentiment in the stock markets.
The AUM of the mutual fund industry rose 24% to an all-time high of Rs 38,450 at the end of November, from Rs 31,000 billion at the end of December 2020.
Gold Exchange Traded Funds (ETFs) also attracted investors with net inflows of over Rs 45 billion in 2021.
In December 2021, the mutual fund acquired shares worth over Rs 30 billion Initial Public Offering (IPO), At a time when FIIs were selling heavily, mutual funds came to the rescue.
33.8 billion rupees were invested in the new issuance launched in December 2021. MedPlus Health saw the highest inflow of Rs 13 billion, followed by CMS Info Systems (Rs 3 billion), Metro Brands (Rs 3 billion), Tega Industries (Rs 2.8 billion), and Rate Gain Travel (Rs 2.5 billion).
Other issues of Anand Rathi, CE Info Systems, Data Patterns, Supriya Lifesciences, Shriram Properties and Star Health also saw good inflows.
We have been seeing a huge trend of mutual funds on IPOs for months now.
It remains to be seen how the buying and selling of Mutual Funds trend in the month of January 2022.
We will keep you informed of all developments in this area.
stay tuned.
Since you are interested in what mutual funds are buying and selling, see Equitymaster’s Powerful Stock Screener,
This tool tracks the shares recently bought by mutual funds as well as the shares they sold recently.
Happy investment!
PS: The above piece relies on data from PersonalFN. PersonalFN is a Mumbai based personal finance firm that provides financial planning and mutual fund research services.
Disclaimer: This article is for informational purposes only. This is not a stock recommendation and should not be treated as such.
(This article is syndicated from) equitymaster.com,
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
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