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India's equity mutual fund managers have kept their top ten picks almost intact throughout 2014, barring three stocks. Despite being giants in their respective sectors, Bharti Airtel, FMCG major ITC and HDFC have been done away with when it comes to fund managers' top ten list.
"Bharti Airtel, in particular from telecom space, has foreseen headwinds from its Africa's operations. We believe, Idea Cellular may turn out to be a better play going forward," said chief investment officer (CIO) of a large fund house who did not want to be named.
Shares of ITC, which recently gained traction after the government scrapped its plan to ban single cigarettes, have been largely shunned on the back of uncomfortably stretched valuations.
It is interesting to note that ITC was the sixth top invested stock till last year. This year too, it managed to remain in the top ten list, though in the ninth position till September, but was ousted in October.
Further, amid buzz of merger of the HDFC twins, market experts feel that HDFC Ltd is highly valued at the current juncture.
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The stocks which have replaced them are Maruti Suzuki, Bharat Petroleum (BPCL) and Axis Bank.
Maruti is the only auto stock which has found a place in MFs' top ten picks. The stock remained in the buzz throughout the year for its Gujarat unit expansion, which was widely criticized and opposed by the minority investors - fund managers, in particular. But it is the seventh most invested stock in fund managers' equity portfolio.
Maruti is the only auto stock which has found a place in MFs' top ten picks. The stock remained in the buzz throughout the year for its Gujarat unit expansion, which was widely criticized and opposed by the minority investors - fund managers, in particular. But it is the seventh most invested stock in fund managers' equity portfolio.
Though the companies in the top list remained the same to a large extent, there has been a lot of churn in their positions as fund managers shuffled a lot.
For instance, they started the year with IT giant Infosys as their most invested counter, with exposure at 5.6% or Rs 9,452 crore. ICICI Bank was second with exposure of 5.2% followed by HDFC Bank at 3.6%.
But as things stand currently, Infosys has been de-throned by ICICI Bank as the top pick. The IT major has been relegated to the fourth position. On the other hand, State Bank of India (SBI) which was ninth on the list is now the third most sought after stock. Reliance Industries (RIL) has slipped to sixth from fourth while Tata Consultancy Services (TCS) - India's largest software exporter- is ninth on the list from sixth a year ago.
Amid this re-shuffling of stocks, it was only Larsen & Toubro (L&T) - the capital goods major - which remained as the fifth most sought after stock, with a marginal change in exposure at 2.75% of overall equity assets.
All the top ten stocks accounted for Rs 78,484 crore of the equity assets, cornering nearly one-fourth of the total equity AUM of Rs 3.15 lakh crore. Further, it is the first time that fund managers have deployed over Rs 10,000 crore each in four stocks - namely ICICI Bank, HDFC Bank, SBI and Infosys, as per the data available from fund tracking firm Value Research.
ICICI Bank leads as fund managers pumped in Rs 13,841 crore while HDFC Bank managed to attract an investment of Rs 11,600 crore. About 260 equity related schemes have investments in these two private lenders.
