Funds pop pharma stocks

Domestic mutual funds have shown strong interest in shares of companies in pharmaceuticals, diversified, electric equipment, retailing, shipping and entertainment sectors in December 2006.

They exited from banking and finance, construction, personal care and telecom stocks, during the same period.

According to the portfolio analysis for December 2006, Tata Motors, Ansal Properties, Tata Steel, Larsen & Toubro, i-flex solutions, Dr Reddy's Labs, Reliance Industries and Siemens were bought heavily by mutual funds.

The fund houses exited from Development Credit Bank, LIC Housing Finance, Syndicate Bank, Reliance Capital, IVRCL Infrastructure, Syndicate Bank and Reliance Capital.

The analysis shows that fund houses have bought 66.38 lakh shares of Tata Steel, 42.44 lakh shares of Ansal Properties, 19.32 lakh shares of Dr Reddy and 16.55 lakh shares of Tata Motors.They sold 14.76 lakh shares of Infosys Technologies and 87.71 lakh shares of ITC.

The fund analysis by HDFC Securities shows that some of the sectors that witnessed additional buying by more than four funds were automobiles, banking, software, entertainment, pharmaceuticals, aluminium, diversified, electric equipment, retailing and steel.

The maximum churning of portfolios were done by Kotak Mahindra Mutual Fund, DSP Merrill Lynch Mutual Fund and Prudential ICICI Mutual Fund during December 2006. These funds have made fresh addition and total exits from around 25-35 stocks each.

Morgan Stanley Mutual Fund, Stanchart Mutual Fund and SBI Mutual Fund have done the least churning.

These funds made fresh additions and total exits around six to seven stocks each. The most active churners were Birla Sunlife Mutual Fund, Tata Mutual Fund and Kotak Mahindra Mutual Fund.