FPIs and MFs think alike

While domestic funds have been pouring money into equities, foreign portfolio investors too have been upbeat about the Indian equity market. Their investment in the listed stocks (based on Capitaline) have risen by 33 per cent to ₹23 lakh crore between March 2016 and March 2017.

Interestingly, FPIs’ sector choices mirror domestic mutual funds’ preferences in the recent rally. FPIs increased their holdings significantly in banks, finance, auto and auto ancillaries. These have also remained the top preferred sectors for domestic mutual funds. Defensives such as IT and pharma have been shunned by FPIs too, over the past year.

Tata Motors-DVR, LIC Housing Finance, Shriram Transport Finance, Fortis Healthcare, Federal Bank, and Container Corporation Of India were some stocks in which FPIs increased their holdings substantially.

Carborundum Universal, Supreme Industries, Kirloskar Oil Engines and Dewan Housing Finance, on the other hand, are some stocks where the FPIs have reduced their holdings notably over the past year.

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