Equity mutual funds deployed Rs 400 crore from their cash balances in September, a report by Nuvama Alternative & Quantitative Research said on Tuesday.
With this, the overall balances fell from Rs 1.77 lakh crore, or 5.23% of the AUM of equity schemes, in August to Rs 1.76 lakh crore, or 5.13%, in September.
Kotak MF led the deployment, reducing its cash holdings by Rs 1,300 crore, followed by Nippon India MF and Quant MF, which pared cash by Rs 800 crore and Rs 700 crore, respectively. “This trend reflects a continued tilt towards equity allocation among select funds,” the report said.
Conversely, a few schemes opted to raise their cash buffers, signalling selective caution. Motilal Oswal MF increased cash by Rs 3,600 crore, taking its ratio from 2.2% to 6.2%, while PPFAS MF added Rs 1,100 crore, maintaining its already-elevated cash ratio at 21.8%. Baroda BNP Paribas MF raised cash by Rs 500 crore, lifting its ratio from 4.6% to 6.7%.
According to the report, key stock additions during the month across the mutual funds industry were Kotak Bank, ICICI Bank and Eternal, while key reductions were Axis Bank, Maruti Suzuki and Bajaj Finance.