India’s largest mutual fund bought these 10 stocks in July; do you own any?

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Country’s biggest mutual fund SBI Funds Management was on a shopping spree in July as it picked up a couple of initial public offerings (IPO) and select midcap and largecaps from Dalal Street. The latest data available with Ace Mutual Fund showed that the money manager held more than 4 crore shares of recently listed online food delivery firm Zomato and 1.69 lakh shares of Tatva Chintan Pharma Chem. Shares of Zomato on July 23 got listed at Rs 116 on the National Stock Exchange, a 53% premium on its final offer price of Rs 76. On the BSE, it kicked the trade at Rs 115 at a premium of over 51%.

Analysts still hold a bullish view on Zomato despite robust listing gains. Jefferies recently upgraded the target price of the company to Rs 175 from Rs 170 earlier. “Zomato reported a strong beat on revenues led by over 37% QoQ in gross order value. Adjusted Ebitda loss at Rs 170 crore is also on expected lines. Management release has interesting insights but lacks details on monthly transacting users, average order value and unit economics (provided in RHP), which could disappoint investors as could the decision of an annual earning call.

Secondary market

The money managers also lapped up additional 5 crore shares of FMCG major ITC. It also bought more than 1 crore shares each of YES Bank and NHPC. SBI MF also looks bullish on the banking sector as it lapped up a couple of private and public sector lenders last month. It bought more than 10 lakh shares each in ICICI Bank, HDFC Bank, Axis Bank, State Bank of India and Kotak Mahindra Bank.

Coming to the latest quarterly results of some of these companies, ITC last month reported a 30.24% jump in its consolidated net profit to Rs 3,343.44 crore for the first quarter ended June 2021 lead by a “strong rebound” in operating segments. It had posted a net profit of Rs 2,567.07 crore during the April-June quarter of the previous fiscal. Brokerage Geojit Financial Services has a ‘Buy’ call on ITC with a target price of Rs 263.

On the other hand, the country’s largest lender SBI posted a 55.25% jump in standalone profit after tax at Rs 6,504 crore for the quarter ended June, helped by lower provisioning for bad loans and higher non-interest income. The lender’s standalone profit after tax stood at Rs 4,189 crore in the same quarter of the previous fiscal.

Brokerage Emkay Global Financial Services is positive on SBI with a target price of Rs 600. “SBI is the second-best pick after ICICI, and we believe that better-than-expected growth or asset quality movement could provide further upsides to earnings/valuations,” it said.

Finolex Industries, Infosys, NTPC, Adani Ports, Bharti Airtel, DLF, Reliance Industries, Tata Motors, HDFC, Manappuram Finance, Cipla, Wipro, NMDC, Tube Investment and Vedanta stood among other players in which it purchased more than 10 lakh additional shares in July.

In and out

Aarti Industries, Clean Science and Technology, Dalmia Bharat, eClerx, GR Infraprojects, India Pesticides, Nippon Life Asset Management and Tata Chemicals emerged as fresh entrants in the portfolio of SBI MF. On the other hand, it completely exited players like Cera Sanitaryware, Sundram Fasteners, Supreme Industries and Vodafone Idea.