Inflows into equity and equity-oriented mutual fund schemes continued in April but at Rs 3,437 crore, they were lower than Rs 9,115 crore in March 2021. The surge in coronavirus cases affected the flow in April but experts say the pace will pick up once infections begin to slide and the vaccination drive gathers momentum.
At Rs 5,933.38 crore, mutual funds’ direct investment in equities more than doubled in April against Rs 2,476.45 crore in March. Systematic Investment Plan (SIPs) inflows were at Rs 8,590 crore in April compared to Rs 9,182 crore in the previous month.
"The net inflows into equity funds have continued in April, which is very encouraging. Flows slowed down a bit compared to March largely because of the disruption caused by the second wave of the pandemic. However, the SIP numbers have remained robust and the addition of SIP folios also have been very healthy," said G Pradeepkumar, CEO at Union AMC.
He expects flows to pick up once the pandemic is brought under control through increased vaccination and other measures.
The Sensex fell 1.5 percent and the Nifty 0.4 percent in April, partly hit by FII selling equities worth Rs 12,039 crore. The broader markets did better than the benchmarks. The BSE midcap index was up 0.65 percent and the smallcap index gained 4.94 percent in April.
In April, mutual funds made fresh buys into seven stocks—Eveready Industries, Federal-Mogul Goetze, Infibeam Avenues, Macrotech Developers, PowerGrid Infrastructure Investment Trust, Satin Creditcare Network, and Tata Motors DVR Ordinary, said Dolat Capital. The buying in these stocks was worth Rs 269 crore.
Fund houses acquired shares worth Rs 84.57 crore in Mumbai-based real estate company Macrotech Developers through the initial public offering. The company raised Rs 2,500 crore through its IPO.
Also read: Equity fund inflows continue in April; bond schemes, Gold ETFs in demand
PowerGrid Infrastructure Investment Trust also launched its IPO on April 29 and the fund house might have bought a stake worth Rs 17 crore. It was the first InvIT by the state-owned entity and it has Power Grid Corporation of India as its Sponsor.
Mutual funds exited seven stocks—Apollo Micro Systems, Harita Seating Systems, Panacea Biotec, Poddar Pigments, Prabhat Dairy, Sharda Motor Industries, and Take Solutions, said Dolat Capital.
The schemes sold out Rs 43.95 crore of shares of these companies in April.
For the Nifty50 firms, the highest buying by asset management companies was seen in Adani Ports, Axis Bank, Bajaj Finance, Bajaj Finserv, HDFC, ICICI Bank, L&T, SBI and Sun Pharma, Dolat Capital said.
On the other hand, Asian Paints, BPCL, Bharti Airtel, Cipla, Coal India, Dr Reddy's Labs, Hindalco Industries, JSW Steel, Maruti Suzuki and Tata Consumer Products saw the highest selling by mutual funds in April.Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.