Corporate tax rate cuts: Mutual funds use rally to offload winners

Mutual funds (MFs) were seen booking profits in stocks that surged in September, following the government’s decision to lower corporation tax rates. Maruti Suzuki, HDFC Bank, and Bajaj Finance were key frontline stocks that saw selling between Rs 700 crore and Rs 1,400 crore by domestic MFs. On the other hand, Axis Bank, ICICI Lombard, HDFC, SBI Life, as well as Zee Entertainment were among the most-bought counters during September. Shares of all five companies remained soft during the month. The buying in Axis Bank was accentuated, as domestic fund managers participated in the private sector lender’s Rs 12,500-crore qualified institutional placement (QIP) programme. Some of the uncommon entities in the list of most-bought stocks  included Astral Poly Technik (net buying worth Rs 247 crore), Phoenix Mills (Rs 161 crore) and DLF (Rs 179 crore). Nestle India also saw buying by MFs worth Rs 462 crore, following its addition to the Nifty. On an overall basis, fund houses pumped in Rs 11,000 crore into stocks during the month with the benchmark Nifty ending with 3.6 per cent gain.