• by Sayantan Das
• 24th Dec 2020

In 4 Quarters, Fund Managers Raised Stake in 100+ Stocks

Data from AceEquity showed that Fund Managers’ who remained net sellers in the Indian equity markets for over Rs. 60,000 crore raised stakes in more than 100 companies. Almost 80% of these stocks are from small & midcap space and include Indian Energy Exchange, Natco Pharma, Blue Dart etc.

Thanks to global liquidity, small & midcaps stocks outperformed benchmark indices.

Professional Investor and Founder & CEO of Green Capital Single Family Office, Nitin Shakdher said, “The thematic funds focused on broader markets are expected to do well in the future. The money appreciation typically starts in the large caps at the start of the rally. Once the broad largecap has rallied, the money flow starts picking up in the midcaps and subsequently in the smallcaps,”

MFs raised stakes in seven stocks in the past 4 quarters and that doubled investor wealth in 2020. Gopal Kavalireddi, Head of Research, FYERS, told that these sectors are likely to continue being in the focus in 2021 as well, but stock-specific research based on the upcoming quarterly results would provide better guidance.

The last three years were a torrid time for small and midcap indices. They went into a bear phase after their January 2018 all-time high.

Negative returns were delivered due to ILFS crisis, economic downturn and shunned by retail investors.

Head Research, Capital Via Global Research Limited, Gaurav Garg said, “Investors should look at key indicators such as earnings growth, expansion, revenue, and market share before making any decisions, as the price action may be short.”

He also said if a company lacks a large market share or a consistent growth, investors can book profits now as the prices have doubled. However, they can keep it for the long term if the company is large or has a consistent record.