MFs focus on large-cap in Q2, markets bet on public sector companies

Fund managers say PSUs look attractive as valuations are cheap and possibility of strategic sales offers room for value unlocking

Domestic fund managers, managing over Rs 7 trillion in equity assets, are keeping their faith in large-caps, while initiating select buying in the mid-cap segment.

Compared to the June quarter, mutual funds (MFs) raised their stakes in 69 large-cap firms, while trimming exposure in 29 of them, showed an analysis of shareholding pattern for the September quarter (Q2). Among mid-caps, MFs have increased their position in 77 firms, while pruning their stake in 57 entities in Q2.

“We believe opportunities have emerged in mid- and small-caps post the steep corrections. While the broader market is likely to remain volatile, our