Mutual Funds bet big on small companies

Domestic mutual funds have doubled their investment in several small companies in the quarter ended September. According to the data compiled by ET, mutual funds increased their stake in about 124 small and mid-level companies with a market capitalisation of less than Rs 2,000 crore. ITD Cementation has seen the highest increase in MF investment from 1.98% in the June quarter to 18.08% in the September quarter. Gammon Infrastructure (up 10.06%), Omkar Speciality (7.04%),Jyoti Structure (6.84%) and NRB Bearing (5.92%) have also seen signifi cant rise in MF investment. This kind of interest by mutual fund managers in mid- and small-cap stocks was unheard of since 2009 when this category of shares rallied sharply. Some companies in which MFs have reduced their stake are Easun Reyrolle, Texmaco Rail, Hinduja Ventures and Tilaknagar Industries.