Mutual funds (MFs) continued to raise exposure to private sector banking stocks in February, extending the buying trend seen in the previous month. HDFC Bank garnered the highest net inflows for the second consecutive month in February as fund managers deployed around Rs 7,000 crore in the private lender last month, shows an analysis by Prime MF Database.
In January, MFs had invested around Rs 11,300 crore in the same stock.
ICICI Bank and Kotak Mahindra Bank also remained among the top five that witnessed the highest net inflows for the second month in a row. In February, MFs deployed Rs 5,429 crore into ICICI Bank and Rs 3,075 crore into Kotak Mahindra Bank.
Infosys and Eternal also figured among the top five purchases, attracting about Rs 5,537 crore and Rs 3,254 crore, respectively.
The continued accumulation of large private banks comes amid a constructive outlook among fund managers on private lenders, as valuations have eased in recent years owing to a prolonged period of underperformance.
While fund houses bought big into private lenders, the largest public sector bank, State Bank of India, led the most-sold stocks list. Fund houses pulled out over Rs 9,000 crore from the stock last month, according to the analysis. Larsen & Toubro, Bajaj Finance, Power Grid Corporation of India and Vedanta were the other most-sold stocks last month.
