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Fund houses pare equity exposure as managers rotate toward defensives
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Indian mutual funds cut stakes in multiple large- and mid-caps—up to 70%—redirecting exposure toward defensives like FMCG and banking amid valuation concerns.
Over twenty domestic mutual fund schemes trimmed positions in ten prominent equities, reducing holdings by as much as seventy percent since August. Key declines included Aditya Birla Fashion (₹532 crore) and Raymond Ltd (₹71 crore). Portfolio managers cited stretched valuations and a preference for defensive sectors amid volatile foreign inflows. The pullback, the sharpest in two quarters, highlights an ongoing realignment toward low-beta segments such as FMCG and banking. Analysts view the rebalancing as profit-taking after extended mid-cap rallies through the fiscal year.