Mutual Funds – The benchmark Nifty is trading above the 20,000 mark, and the Indian stock market indices are at all-time highs. Strong local macroeconomic data and encouraging international cues have combined to propel the advance in domestic equities markets.
Although the Nifty50 index has gained more than 11% so far in 2023, the midcap and smallcap indices have performed significantly better than the frontline indices.
The rally is being driven by a number of macro variables, including robust domestic GDP growth, moderate inflation, a declining current account deficit (CAD), and rising global interest rates. Additionally, experts added that strong corporate earnings growth and forecasts for an earnings CAGR in the high teens for the period of FY23 to FY25 have maintained market sentiment positive.
Equity mutual funds experienced a strong increase in net inflows, which peaked in August 2023 at $20,245.26 crore, a five-month high. However, there were 348 crore in outflows from large-cap stock funds.
Among the large equities that mutual funds purchased the most in August were Adani Power, Zomato, Indian Railway Catering And Tourism Corporation (IRCTC), and Tata Power Company.
According to a report from ICICI Direct, the Asset Management Companies (AMCs) purchased 4.25 crore shares of Interglobe Aviation for $10,339 crore in August, then 82.46 crore shares of Zomato for $8,048 crore.
According to the ICICI Direct report, mutual funds purchased 1.38 crore shares of Britannia Industries for $6,150 crore, Dabur India shares for $4,153 crore, Tata Power shares for $3,024 crore, and UPL shares for $2,952 crore over the course of the previous month.
On the other hand, among the top 10 large-cap shares that mutual funds sold the most of in August were Tata Consumer Products, Tube Investments of India, Pidilite Industries, Trent, and Dr. Reddy’s Laboratories.
According to the report, AMCs sold Dr. Reddy’s shares for Rs. 8,067 crore and Trent Ltd. shares for Rs. 6,243 crore.
