Top 5 Large Cap Stocks with Highest MF Holding

Which Are These 5 Stocks?

Introduction

As per the categorisation done by SEBI, the top 100 companies according to the market capitalization are called as the large cap companies. From these 100 companies which are the top 5 large cap companies in which mutual funds have invested the maximum amount of money? Which are the top equity funds or ETF’s which have invested in these stocks? This is exactly what we will be studying today.

Top 5 Stocks

1. hdfc bank

HDFC Bank is the biggest bank in the private sector. They have business model is such where in their 60% business is from retail and the rest of the 40% is from wholesale banking. It is a well governed by with highly rated corporate governance. They have a consistent growth rate of 15% to 20%.Also, the performance of the share price of HDFC bank has been consistent. Even though it is already very big, HDFC bank will grow even larger in the future. HDFC bank has become a $100 billion company.

• Kotak Banking ETF Fund is focused on banking stocks and does not have non-banking stock in its portfolio. This ETF fund has been performing well.
• Aditya Birla Sun Life Frontline Equity Fund and SBI Bluechip fund are large cap oriented funds.
• Thus, it can be clearly seen that HDFC bank has received very healthy investments.

2. ICICI Bank

ICICI was in a stagnant phase for the last couple of years because of the NPA pressures and then later on the controversies involving Chanda Kochhar. As a result the bank was marked negatively in corporate governance and also saw FII and mutual funds sell-off because of it. The profits of the bank were low as the provisioning done in for the NPA’s was high. But now, seems like the bank has manged to pass it and now is in the revival phase.

• The percentage of stake held by mutual funds in ICICI bank is 18.59% which is a very big portion compared to HDFC bank.
• HDFC Balanced Advantage fund was earlier called as HDFC Prudence fund.
• Seems like the fund manager of both HDFC balanced advantage fund and HDFC equity fund is Mr. Prashant Jain, a veteran fund manager, as a lot of trust in ICICI bank. It is very interesting to note that the Chief Investment Officer (CIO) of HDFC AMC has given healthy allocation to the stock of ICICI bank.
• ICICI Prudential Equity & Debt fund was earlier called as ICICI Prudential Balanced fund.

3. infosys

Infosys is a bellwether IT Company with a very good corporate governance. Last year was very good for Infosys the major reason behind it being dollar appreciation and rupee depreciation. Last year in general was very good for the overall IT sector.Thus, IT sector has passed the rough phase and a stagnant growth can be expected from top IT stocks.

• HDFC Balanced advantage fund, HDFC equity fund and HDFC top 100 fund are all managed by Mr. Prashant Jain. So, seems like he also has a high trust on Infosys.
• Aditya Birla Sun Life Frontline Equity fund is manged by Mr. Mahesh Patil.

4. reliance industries

Reliance Industries is the biggest company in India among the listed companies.

• Kotak Standard Multicap Fund Regular Plan is manged by Mr. Harsha Upadhyaya, CIO of Kotak AMC. This is one of the flagship funds of Kotak AMC. It is a multicap fund with a larger cap blend to it.

5. state bank of india

Similar to ICICI bank, SBI too has gone to a lot of restructuring. There were a lot of MPA issues, issues with provisioning and hence faced losses. But now, the next 2-3 years look good. The NPA are back in control and positive things are happening after the actions taken by RBI.

• The also the 3 funds manged by Mr. Prashant Jain have investments with good allocations.
• SBI Equity Hybrid fund was earlier called as SBI Balanced fund.

summary

1. These were the 5 large cap stocks in which the mutual funds have invested the highest amount of money.
2. The ETF’s of Nifty or Sensex are mandatory to invest in these stocks but other equity mutual funds too have invested heavy amounts in them.
3. Large Cap stocks are very important from liquidity perspective, because whenever a mutual fund faces redemption pressure, then large cap stocks, such as above, are very easy way to redeem their money.
4. Mr. Mahesh Patil and Mr. Prashant Jain most probably have a similar kind of thought process in large cap holding, as they have invested healthy amounts in majority of the above stocks.

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 stock 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.