Bank stocks attract fund houses in September

About 16% of investments flow into the sector.

Bank stocks were clear favourites of the mutual fund houses in September, says a report on the holding pattern of the fund industry.

Around 16 per cent of the investments made by fund houses were in the banking sector, followed by the petroleum, gas and petrochemical products at 11 per cent and software and consultancy services at 7 per cent, according to a report by brokerages Sharekhan and Religare Finvest.

Fund managers maintain that they are and will continue to be bullish on the banking sector, keeping in mind the growth opportunities in the sector.

The banking sector index moved up by 15 per cent during the period.

Another sector that fund managers consider attractive is FMCG. However, it accounted for only 3 per cent of the investments made by fund houses.

The FMCG index gained 5.5 per cent.

South Indian Bank was the top buy for mutual fund houses during August-September with around 5.7 crore shares being purchased. ITC was the top sell with around 1.7 crore of the shares being sold. Gujarat Pipavav Port Ltd was the second highest buy at 1.5 crore shares.

Other big names that featured on the sell list included Reliance Industries Ltd, Reliance Communication Ventures Ltd, Tata Consultancy Services Ltd and Infrastructure Development Finance Co Ltd.

In spite of ITC being the top sell share, it continued to be popular among fund houses; 213 schemes featured this stock, with the number of shares held being at 17 crore. The value of these shares was Rs 3,079.78 crore. The next most popular scrip was NTPC with 14.9 crore shares being included in 162 schemes. However, the value of NTPC share was higher at Rs 3,235.09 crore.

A total of 7.69 crore shares were sold by the fund houses during this period. Out of this, 1.86 crore were sold by DSP Blackrock Mutual Fund. IDFC and Reliance mutual funds occupied second and third spots respectively. IDFC MF sold 1.42 crore shares and Reliance MF sold 47 lakh shares.

The assets under management of the mutual fund industry saw an increase of around 4 per cent between August and September.

Source: http://www.thehindubusinessline.com/2010/10/20/stories/2010102052401200.htm