Did Asadh's decline of market correlate to the mutual funds' sales of stocks? Find out through SS Pro

There are 16 mutual funds in the country currently. Out of 16, Siddhartha Equity Oriented Scheme (SEOS) got matured recently. Nabil Balance Fund 2 (NBF2), Citizens Mutual Fund 2 (CMF2) and NIBL Sahabhagita Fund (NIBLSF) (open end mutual fund) are new mutual funds added to the list.

Mutual funds have an investment in listed/ unlisted funds of Rs 7.43 arba in Asadh compared to Rs 7.49 arba in Jestha. Similarly, mutual funds have increased bank balance from Rs 4.24 arba in Jestha to Rs 5.82 arba. This shows that the mutual funds have sold shares. Mutual funds investment in debentures and public shares amounts to Rs 93.49 crores. Similarly, the funds also have invested 1.70% in primary shares which amounts to Rs 25.23 crores.

The top investments by mutual funds irrespective of sectors in the month of Asadh are as follows:

The top most bought stocks in Asadh by the overall mutual fund industry are as follows:

 The top most sold stocks in Asadh by the overall mutual fund industry are as follows:

Sector-wise Breakdown

Investment in commercial banking industry accounts for the highest sector-wise investment of Rs 2.95 arba. Likewise, they have investment of Rs 94.45 crore in shares of microfinance companies, accounting for the second-highest sector-wise value. Non life insurance companies sector stands at the third highest investment priority for mutual funds with an investment worth Rs 80.66 crores.

Commercial banks:

Among the commercial banks, Nepal Bank Limited (NBL) is seen as the top priority for investment by mutual funds. It accounts an investment worth Rs 35.48 crores. Nabil Bank Limited (NABIL) stands at the second position with investment of Rs 32.67 crores. NMB Bank Limited (NMB) stands with the investment of Rs 19.98 crores.

Development Banks:

As for the development banks, Muktinath Bikas Bank Limited (MNBBL) has the highest investment preference among mutual funds. The mutual funds have invested an amount worth Rs 13.06 crores. Shine Bank Limited (SHINE) is seen in the second position with an investment worth Rs 6.80 crores. Garima Bikas Bank Limited (GBBL) has an investment of Rs 6.02 crores at the third position.

Microfinance companies:

Among the listed microfinance companies Sana Kisan Bikas Bank Limited (SKBBL), Chhimek Laghubitta Bikas Bank Ltd. (CBBL) and Deprosc Development Bank Ltd. (DDBL) were the top three investment priorities for mutual funds. Mutual funds invested Rs 16.33 crores in Sana Kisan Bikas Bank Limited (SKBBL), Rs 16.06 crores in Chhimek Laghubitta Bikas Bank Ltd. (CBBL), and Rs 12.78 crores in Deprosc Development (DDBL).

Life Insurance companies:

Among the life insurance companies in Nepal, Nepal Life Insurance Company Limited (NLIC), National Life Insurance Company Limited (NLICL) and Life Insurance Company Limited (LICN) are the investment companies of top priorities for mutual funds. Mutual funds schemes have around Rs 23.35 crore investments in NLIC, Rs 21.98 crore investments in NLICL and Rs 15.31 crores investment in LICN.

Non-Life Insurance companies:

Among the non-life insurance companies in Nepal, Shikhar Insurance Company Limited (SICL), NLG Insurance Company Limited (NLG) and Sagarmatha Insurance Company Limited (SIC) are the investment companies of top priorities for mutual funds. Mutual funds schemes have around Rs 12.68 crore investments in SIC, Rs 11.27 crore investments in NLG and Rs 98.80 crores investment in SIL.

Hydropower companies:

The inclination of investment in hydropower companies for mutual funds was in Chilime Hydropower Company (CHCL) with an investment of Rs 15.47 crore, Butwal Power Company Limited (BPCL) with an investment of Rs 10.81 crore and Sanima Mai Hydropower Company (SHPC) with an investment of Rs 5.02 crore.

Finance:

As for finance companies, the top three investments were Manjushree Finance Limited (MFIL), ICFC Finance Limited (ICFC)and Goodwill Finance (GFCL). Mutual funds invested an amount of Rs 55.28 lakhs in MFIL, Rs 55.27 lakhs in ICFC Finance and Rs 28.30 lakhs in Goodwill Finance Limited.

Hotels:

Among the three listed hotels in NEPSE, mutual funds have given higher priority to Oriental Hotels Limited (OHL) with an investment of Rs 2.21 crores.

Mutual fund:

The mutual fund schemes also invest in other mutual funds. The mutual funds have preferred as the Siddhartha Equity Oriented Scheme (SEOS) best scheme for investment. It has an investment that accounts to Rs 4.84 crore. NMB Sulav Investment Fund-1 (NMBSF1) falls under the second highest investment value mutual fund. It has an investment of Rs 3.60 crores. Finally Citizens Mutual Funds (CMF1) has a third highest investment of Rs 1.22 crores.

Manufacturing & Production:

Mutual funds have invested Rs 17.38 lakhs in Shivam Limited (SHIVM), Rs 59.43 lakhs in Unilever Company Limited (UNL), Rs 3.43 crores in Bottlers Nepal Terai Limited and Rs 1.51 crores in Himalayan Distillery (HDL) as of Asadh, 2075.

Others:

As for the others sector, mutual funds have invested Rs 33.43 crores in Nepal Doorsanchar Company Limited (NTC), Rs 14.30 crores investment in Citizen Investment Trust (CIT),  and Rs 2.17 crores in Jalabidyut Lagani Tatha Bikas (HIDCL).

 Preference shares and Promoter shares:

Similarly, the preference and promoter shares as per the choice of mutual funds are:

Hence, the overall analysis draws the top companies preferred by mutual funds for investment. This article might be helpful to the aspiring investors in the secondary market. What are your views on the mutual funds? Do you think the top investment decisions made by mutual funds are backed up with rationality? Please write to us in the comment section below.

(Disclaimer:  Any kind of information that is provided in the article should not be used as a sole advice or recommendation by investors in order to design their investment portfolio. So, before taking steps for any kind of the information, the investors are required to base their judgment on their own financial analysis, appropriateness of the information and seek independent financial advice. The information of the company has been taken from the authorized sources such as website of the company, NEPSE, financial reports and press releases of the companies so, any changes not updated in these may differ in the analysis.)