Mutual Fund Buy in Mid Cap Stocks

Mid Cap Stocks Bought by Mutual Funds in Feb 2019

introduction

Which top 10 mid cap stocks have been bought by the mutual fund companies in February 2019? What is the current total mutual fund holding in these mid cap stocks? Why have been these stocks added? How are these stocks performing? SEBI has done the new categorization of stocks into large cap, mid-cap and small cap. The stocks from 101 to 250 as per the market capitalisation are the mid cap stocks.

Let’s study the recent actions of Mid cap stocks in Mutual Funds:

1. Current MF holding means the total investment made by all the mutual fund companies in that company.
2. The worth of shares bought mean the new total investment done by all the mutual fund companies in that stock in the month of February 2019.

top 10 mid cap stocks

1. Emami is a FMCG company with many established brand to its name, like Emami cream, Boro Plus and Zandu Balm, etc. Emami is a beatdown stock. Having a 52 week high of almost Rs. 600 the stock came down till Rs. 340, and now it has revived and coming up till Rs. 400. The reason behind the fall was pledged promoter holding; almost 50% of the promoter holding is pledged. The promoter is also involved in real estate activities for which the personal stake has been pledged. The promoter has assured that he will free up all pledged holding in the coming 6-9 months. Other than this, there is no issue with business of the company. If the promoter concentrates on the core business, then the company has quite a scalable kind of business. Emami has healthy market share as well as mind share. The assurance given by the promoter of Emami has maybe increased the hopes of the mutual fund houses in this stock again.
2. ACC can be argued that will become a large cap stock now, but according to SEBI it is now a mid-cap stock as per its weighted average market cap. ACC, too, was a beaten down stock. After giving a 52-week high of Rs. 1,678 the stock came down till Rs. 1,255, and now it is trading around Rs. 1,530.
3. Voltas has completed its correction phase. From a price of Rs. 627 it has been corrected down to a price of Rs. 475, and now again has rived back to the same level at Rs. 625. 23% mutual fund holding in Voltas shows their confidence in the company.
4. Bata is very well performing stock and is in the rising phase from the last 6-7 months. The Red concept stores from bata have received a positive response form the people because of which the results of Bata were very good. Also, as per the guidance given by Bata, they are expecting to maintain same kind of increasing results in the future quarters.
5. 19.38% mutual holding of the total stake of the company is a very positive number for Ramco Cements just like Voltas.
6. Balkrishna Industries is a tyre company. The share price of Balkrishna Industries too, came down from a 52-week high of Rs. 1,425 to Rs. 760 and is not trading up at Rs. 930. This upside for Rs. 760 to Rs. 930 is because of the increased mutual fund investments in this stock.
7. Aditya Birla Retail & Fashions was also not on a downside and in a continuing upside phase. Investments while in that phase indicated that mutual funds think that they are still getting the stock at reasonable valuations.
8. Supreme Industries is into production of plastic products.
9. Sundaram Finance is a Non-Banking Financial Corporation (NBFC). The NFC’s have gone through some crisis after the IL&FS crisis. But compared through other NBFC’s, the fault in Sundaram Finance was less. The share price of Sundaram Finance lost the level of Rs. 1,600 after the NBFC crisis but not has regained the same trading level.
10. SRF Ltd is into manufacturing of chemical polyesters and packaging films. The share price of SRF Ltd experienced a 10% correction and from there it has again gone even more up.

summary

1. These were the top 10 favourite mid cap stocks about which mutual funds felt positive and made investments in, in February 2019.
2. Just because these are mid cap stocks don’t mean that only mid cap funds invest in them. Multi cap stocks too invest in them. We have even seen some balanced funds invest in mid cap stocks.
3. Only Emami and ACC were the beaten down stocks in this list. All the other mid cap stocks were in the rising phase and the increased mutual fund investments have added to the fire.
4. Bata and Aditya Birla Retail & Fashion are the stocks where there were no corrections and mutual funds have invested in them while they are in their uptrend.

notes :

• The numbers that are used are approximate and have been rounded for presentation purposes.
• We are not in any way saying that these are bad companies, or the stocks of these companies are bad.
• We are also not suggesting anyone to immediately go and buy these stocks or invest in the stock markets.
• Only an analysis has been presented here. No judgments or final statements are being made here.