Mutual funds pip FIIs in equity buys since April

Even as the markets are hitting new peaks on a regular basis with the benchmark sensex crossing the 30,000 mark, mutual funds (MFs) have emerged as the biggest investors in stocks in the last one and a half months.

MFs have invested 2.5 times more than foreign institutional investors (FIIs) on a net basis in shares since April. Equity MFs made net investments of nearly $2.2 billion (Rs 13,834 crore) between April 1and May 15, data with market regulator Sebi showed. In contrast, net investments by FIIs stood at only about $786 million (Rs 5,029 crore) between April 1and May 17. Fund houses invested Rs 11,224 crore on a net basis in April alone -the best showing since November last year.

Equity funds went on a buying spree due to steady inflows into schemes during April. “There has been optimism because of several factors including the forecast of a normal monsoon,“ said Sunil Singhania, chief investment officer (CIO), equity investments, Reliance MF.

Gopal Agrawal, CIO (equities), Tata MF , said, “There is a value-buying opportunity in certain sectors including IT and metals.“

Equity MFs (including equity-linked savings schemes) received net inflows of nearly $1.5 billion (Rs 9,429 crore) in April, data with the Association of Mutual Funds in India showed.This enabled fund houses to aggressively deploy money in the stock markets. But in 2017, FIIs have outpaced MFs in stock market investing by a wide margin.Overseas investors have net bought shares to nearly $7.2 billion (Rs 45,823 crore) on the back of huge deployments in February and March, data with share depository NSDL showed.