Mumbai: Some smart fund managers bought shares of TCS in March, ahead of the 1:1 bonus announcement and better-than-expected results. Twenty diversified equity mutual fund schemes, which did not own TCS shares in February, added its shares to their portfolios in March, show data from Accord Fintech. Shares of TCS traded at an average price of Rs 2,919.70 in March and moved up sharply to end at Rs 3,415, up 17 per cent, after the company announced a 1:1 bonus and good guidance. The rally has helped TCS become the most valuable Indian company in terms of market cap and cross $100 billion in market cap.
“Improving margins, strong earnings visibility, reasonable valuations and benefits of a depreciating rupee making it a compelling pick,” says a fund manager at a domestic fund house, who bought the stock in March.
In March, TCS was the most bought stock by mutual funds as they collectively bought shares worth Rs 4,100 crore, taking their total ownership in TCS to Rs 11,939 crore. It is still behind Infosys, where funds collectively own stocks worth Rs 26,144 crore.
“Expectations of better results, growth coming back in its key markets, Europe and the US where it operates, under ownership of stock when comparison to Infosys was a reason for fund managers to lap up TCS,” says Kaustubh Belapurkar, director (fund research), Morningstar India.
