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Domsetic Mutual Funds + Insurance Ownership – Equities

May 6, 2010

We have already written on how FIIs have increased their exposure to Indian Equities. Mutual Funds and Insurance companies are OW on Staples and Utilities, UW on Energy and IT Services. MFs and Insurance have meaningful opposite view and positioning on Financials, Industrials, Materials and Healthcare.

MF Ownership – Mar-10 quarter did not witness any big shifts in the sector weights. Largest overweight position of Mutual funds were maintained in Industrials (+869bps) and Staples (+286bps). On the other hand, the biggest sector under weights were Financials (-449bps), Energy (-366bps), Materials (- 327bps) and IT Services (-262bps).

Top-5 increases in holdings relative to benchmark were ITC (+2.5%), L&T (+2.2%), BHEL (+2.0%), Crompton Greaves (+1.0) and Lupin (+0.5%).

Top-5 declines in relative holdings were RIL (-3.6%), Infosys (-2.3%), HDFC (-1.8%), HDFC Bank (-1.0%) and ICICI (-0.7%)

Insurance Ownership of Indian Equities: Insurance companies have biggest overweight positions in Materials
(+330bps), Utilities (+266bps) and Financials (+233bps) in the Mar-10 quarter. While the top underweight sectors are IT Services (-405bps), Industrials (-375bps) and Energy (-244bps). During the quarter, insurance companies did not change their sector
weights materially.

Top 5 Buys – SBI (+3.5%), ITC (+3.4%), Tata Steel (+2.2%), ICICI (1.9%), and NMDC (+1.7%).

Top 5 Sells – Infosys (-3.1%), ONGC (-2.4%), L&T (-2.2%), Axis (-1.2%) and NTPC (-1.0%)

You can see some converse investing theories between FIIs and Indian Institutions. Well, doesn’t matter for short-term, stay invested for Long Term as BSE Sensex is going to hit 100,000. Yes we mean it, read the next article 🙂

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