While NEPSE Is at Its Highest, How Did Mutual Funds Model Their Investment Strategy in Kartik?

There are currently 18 mutual funds in the country. Out of 18 mutual funds, Siddhartha Equity Oriented Scheme (SEOS), Siddhartha Investment Growth Scheme (SIGS1), Nabil Balance Fund (NBF1), and NMB Sulav Investment Fund-1 (NMBSF1), and Laxmi Value Fund (LVF1) have matured. Citizens Mutual Fund-2 (CMF2), NIBL Sahabhagita Fund (NIBLSF), NIC Asia Balanced Fund (NICBF) (open-end mutual fund), NMB 50 (NMB50), Siddhartha Investment Growth Scheme-2 (SIGS2), Sunrise First Mutual Fund (SFMF), and Laxmi Unnati Kosh (LUK) are new mutual funds added to the list.

Mutual Funds have an investment in listed/unlisted funds of Rs. 12.70 Arba in Kartik compared to Rs. 12.35 Arba in Ashwin. Similarly, mutual funds have slightly increased their bank balance to Rs. 3.88 Arba in Kartik from Rs. 3.84 Arba in Ashwin. Mutual Funds’ investments in debentures and bonds amounting to Rs. 1.53 Arba. Similarly, the funds also have invested 0.87% in primary shares which amount to Rs. 17.50 crores.

Data Taken from SSPro

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

 Data Taken from SSPro

The topmost bought stocks in Kartik by the overall mutual fund industry are as follows:

 Data Taken from SSPro

The topmost sold stocks in Kartik by the overall mutual fund industry are as follows:

 Data Taken from SSPro

Sector-wise Breakdown

Investment in the commercial banking industry accounts for the highest sector-wise investment of Rs. 5.30 Arba, making up 41.89% of total investment. Likewise, they have an investment of Rs. 1.86 Arba in shares of microfinance companies, accounting for 14.70% of total investment. The Non-Life insurance sector stands at the third-highest investment priority for mutual funds with an investment worth Rs. 1.35 Arba, contributing 10.66% of total investments.

Commercial Banks:

Among the commercial banks, Nabil Bank Limited (NABIL) is seen as the top priority for investment by mutual funds. It accounts for an investment worth Rs. 59.24 crores. Nepal Bank Limited (NBL) stands at the second position with an investment of Rs. 47.28 crores. NIC Asia Bank Limited (NICA) stands with the investment of Rs. 36.45 crores. 

Data Taken from SSPro

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. 21.74 crores. Shine Resunga Development Bank Limited (SHINE) is seen in the second position with an investment worth Rs. 12.15 crores. Garima Bikas Bank Limited (GBBL) has an investment of Rs. 11.68 crores in the third position.

Finance:

As for the finance companies, the top three investments were ICFC Finance Limited (ICFC), Shree Investment Finance Company Limited (SIFC), and Manjushree Finance Limited (MFIL). Mutual funds invested an amount of Rs. 58.26 lakhs in ICFC, Rs. 52.24 Lakhs in SIFC and Rs. 36.66 Lakhs in MFIL.

Hotels:

Among the three listed hotels in NEPSE, mutual funds have given higher priority to Oriental Hotel Limited (OHL) with an investment of Rs. 5.60 crores.

Hydropower Companies:

The inclination of investment in hydropower companies for mutual funds was in Chilime Hydropower Company (CHCL) with an investment of Rs. 14.71 crores, Butwal Power Company Limited (BPCL) with an investment of Rs. 11.88 crores and Rasuwa Gadhi Hydropower Limited (RHPL) with an investment of Rs. 8.76 crores.

Life Insurance Companies:

Among the life insurance companies in Nepal, National Life Insurance Company Limited (NLICL), Nepal Life insurance Company Limited (NLIC), and Life Insurance Corporation Limited (LICN) are top investment priorities for mutual funds. Mutual Fund schemes have around Rs. 43.88 crores in investments in NLICL, Rs. 29.24 crores investments in NLIC and Rs. 28.30 crores in LICN.

Manufacturing and Products:

Mutual Funds have invested Rs. 12.70 crores in Himalayan Distillery Limited (HDL), Rs. 4.84 crores in Bottlers Nepal Terai Limited (BNT) and Rs. 90.01 Lakhs in Shivam Cements Limited (SHIVM) as of Kartik, 2077.

Microfinance Companies:

Among the listed microfinance companies, Chimmek Laghubitta Bittiya Sanstha Limited (CBBL), Sana Kisan Laghubitta Bittiya Sanstha Limited (SKBBL), and Deprosc Laghubitta Bittiya Sanstha Limited (DDBL) were the top three investment priorities for mutual funds. Mutual Funds invested Rs. 33.15 crores in CBBL, Rs. 29.93 crores in SKBBL and Rs. 18.91 crores in DDBL.

Mutual Fund:

The mutual fund schemes also invest in other mutual funds.

Nabil Balanced Fund-2 (NBF2) falls under the highest investment value mutual fund. It has an investment of Rs. 2.94 crores. Sanima Equity Fund (SAEF) has the second-highest equity fund of the value of Rs. 1.95 crores. Finally, Citizens Mutual Fund (CMF1) stood third-highest investment of Rs. 1.87 crores.

Non-Life Insurance companies:

Among the non-life insurance companies in Nepal, Shikhar Insurance Company Limited (SICL), Siddhartha Company Limited (SIL) and NLG Insurance Company Limited (NLG) are investment companies of top priorities for mutual funds. Mutual Fund schemes have around Rs. 29.64 Crores investments in SICL, Rs. 18.73 crores in SIL and Rs. 18.57 crores in NLG.

Others:

As for the other sector, mutual funds have invested Rs. 36.68 crores in Nepal Doorsanchar Company Limited (NTC), Rs. 22.21 crores in Nepal Reinsurance company Limited (NRIC) and Rs. 16.65 crores in Citizen Investment Trust (CIT).

Preference shares and Promoter shares:

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

Analyzing the pattern of investment of mutual fund schemes can help investors design their own investment portfolios, customize them on the basis of risk-taking capacity. It is also helpful for relatively new investors to make buy/sell decisions based on the decisions of the mutual fund's schemes and safeguard themselves against some risk.

Disclaimer: Do not take this as investment advice. The data is taken from authorized sources, i.e. NEPSE, financial reports, and press releases. Any changes updated afterward may differ from the analysis. 

Data Taken from SSPro