Mutual Fund Trends March 2019

The value of assets held by individual investors in mutual funds increased from Rs.11.66 lakh cr in March 2018 to Rs.13.54 lakh cr in March 2019, an absolute increase of 16.08%.


B30 vs T30

In March 2019, 23% of assets held by individual investors is from the B30 locations. 6% of institutional assets come from B30 locations. Institutional assets are concentrated in T30 locations, accounting for 94% of the total.

Individuals B30

The proportion of direct investments in equity, to the total assets held by individual investors, was about 8% in March 2019.

Only 12% of the Individual Investor money in Equity Mutual Fund comes through the direct route out of that 10% comes through the direct route in T30 cities.

Geographical Spreads

Geography wise AUM

Interesting to see – Manipur, Nagaland, Arunachal Pradesh, Andaman and Nicobar, Tripura, Sikkim, Mizoram and other smaller states slowly getting penetrated but are still miniscule ranging from 300-1200 crores.

SIP Data

SIP Data

Indian Mutual Funds have currently about 2.62 crore (26.2 million) SIP accounts through which investors regularly invest in Indian Mutual Fund schemes.

AMFI data shows that the MF industry had added about 9.13 lacs SIP accounts each month on an average during the FY 2018-19, with an average SIP size of about ₹3,070 per SIP account.

Interesting Charts from Brokerage Reports

How HSAW, DI and PVC Pipes are used in Water Transportation

Source : Narnolia

Mode of Logistics Transportation in India

Source : Dalal and Broacha

Market Share of Lubricants Players

Source : Yes Securities

Home Textiles - Companies presence across Value Chain

Source : JM Financial

Welspun, Trident and GHCL are fully integrated players, Indo Count
and Himatsingka are partially integrated

Airline Fleet Strength

Source : Stewart and Mackertich

Per capita cement consumption across world

Source : SKP Research

Interesting Reads 01-04-2019

Companies with  Market cap of over 1 trillion Rs has reached 30 at present

Source : Business Standard


Price to Book Valuation of Nifty and Nifty Bank index - Discount is reducing

Source : Business Standard


Large cap funds outperformed Mid and Small cap fund in last one year. However over a 5 year period, Small and Midcap funds have outperformed Large cap funds

Source : Business Standard


Indian Economy Snapshot (Last 5 years)

Source : Business Standard


Aviation traffic growth Feb 2019 -  Lowest in 57 months

Source : Financial Express


Energy Demand Growth in 5 years  vs Net Income of Discoms.

Source : Business Standard


Metal companies operating profit contribution from each commodities

Source : Hindu Business Line

Interesting Charts from Brokerage Reports

Expectation of strong earnings recovery in midcaps

(Source : Elara Securities)


FII and DII proportion to Free Float

(Source : Motilal Oswal)


% of BSE 200 stocks trading above 200 DMA

(Source : Goldman Sachs)


India's allocation in EM and AEJ Mutual Funds

(Source : Goldman Sachs)


Gap between 200 DMA and 50 DMA | Realized inter day volatility

(Source : Morgan Stanley)


Difference of Nifty 50 and Midcap 100 rolling returns (%)

(Source : Motilal Oswal)


There has been no two consecutive years of negative returns in midcaps

(Source : Elara Securities)


In past 5 out of 6 elections, nifty has averaged 13% returns in 3 months before election results

(Source : Goldman Sachs)


Nifty and Nifty midcap 100 - Ownership structure

(Source : Motilal Oswal)


Nifty Midcap 100 Total market cap at five year low

(Source : Motilal Oswal)

Interesting Charts from Brokerage Reports


Valuation of small caps after steep correction

(Source : B&K Securities)

What led to the Nifty Rally

(Source : Yes Securities)

Breakeven Analysis between diesel and petrol cars have come down significantly

(Source : Kotak Institutional Equities)



(Source : Morgan Stanley Research)

Midcap Drawdown since 2005  

Smallcap Drawdown since 2005

Sensex Drawdown since 2005

Sensex Drawdown since 2009



(Source : Morgan Stanley Research)

FPI vs Domestic MF



(Source : Morgan Stanley Research)

Corporate Profit to GDP : India vs US

Corporate Profit to GDP

Large Companies share in Total Profits – At highest levels

Breadth of Corporate Performance – Revenue and Net Profit Growth

Broad Market Revenue Growth

YoY Revenue and Profit Growth

Trend in RoE and Asset Turnover

Bank Credit Growth



(Source : Morgan Stanley Research)

Market Breadth - % of stocks above 200 DMA (Daily)

Market Breadth - % of stocks above 200 DMA (Weekly)



(Source : Morgan Stanley Research)

Cyclically adjusted P/E (CAPE)

MSCI India P/E relative to MSCI US

Market cap to GDP Ratio



(Source : Morgan Stanley Research)

Inter day volatility at historical lows



Interesting Insider Trades – 2018

One way to source for ideas to research is to look for promoters increasing stake in their companies.

Insider Trading Disclosures - You can download the historical disclosures from the following link. ( Select the dates and click on the download button in the corner )

We have just highlighted the interesting insider trades in the last 1 year.  ( have only focused on entries where promoters have done a direct market purchase.)

Interesting Insider Trades 2018

No recommendations.


Disconnect between price and value in many growth and value stocks

Some snapshots from a Kotak Report


The re-rating of ‘growth’/‘quality’ stocks (see Exhibit 14) and de-rating of ‘value’ stocks (see Exhibit 15) has continued for a long time and we are at a loss to explain the continued mismatch in the price-value equation for the two sets of stocks for such a long period of time. Our previous thesis regarding high correlation between global bond yields and
earnings yields of ‘quality’ stocks has been deflated by the continued fall in earnings yields of ‘quality’ stocks even at the time of rising global bond yields. Anyway, the argument about a potential de-rating in multiples of ‘quality’ stocks on the back of higher global bond yields
may no longer be valid as global bond yields will likely stay subdued due to a synchronized global economic slowdown.

Lastly, certain so-called ‘value’ companies have found new ways to disappoint investors on corporate governance, thereby
making the valuation argument largely redundant for such stocks.
It seems to us that the market has simply taken a ‘permanent’ view on the future of most companies, thereby effectively segregating companies into (1) long-term winners; these are companies with superior business models, trustworthy managements/promoters and good corporate governance practices where no price or valuation may be too high to own the
stocks and (2) long-term losers; companies with inferior business models and poor governance practices where no price or valuation may be too low to avoid the stocks.

Quick Management Insights – Hindustan Unilever, Prataap Snacks, Tech Mahindra, Muthoot Capital, Shree Cement, Reliance Nippon AMC

Sanjiv Mehta of HUL

On Growth - We have grown our delta (incremental) turnover in the last six years by ₹12,400 crore. If it was a separate company, with ₹12,400 crore, it could perhaps be the largest FMCG company. If you look at our profits or Ebitda, we have more than doubled in the last six years. And these last six years, you have seen two consecutive years of drought, demonetization and introduction of GST (goods and services tax).

On Market Development - Market development is a science. What we call seed, accelerate and explode. Where the penetration is less than 10%, we seed it... once the penetration moves from 10% to 20%, we accelerate the development, and once it crosses 20%, then we press the pedal hard and explode it. So, it is a very clear science that we have built.

On Health Foods Drinks - If you look at our country, four out of 10 children are malnourished. Nine out of 10 children do not get the micro-nutrients that’s required and still the penetration of HFD in the country is about 25%. GSK Consumer Health have built a great category. This is a category of nearly ₹8,000 crore and, in that, they are by far the market leaders with great brands—Horlicks, Boost, Maltova, Viva—and when you look at them from any lens in terms of most trusted brands in the country

Source :


Amit Kumat of Prataap Snacks

On Distribution - Our retail outlet reach has increased considerably from 0.5 million to 1.7 million currently and we hope to expand aggressively in next few years also. We would be present in 60% of the country right now. Big markets where we are very weak are Punjab, UP, Southern India, Himachal Pradesh and J&K. It will take another two years for us to have a pan-India presence.  We have acquired Avadh Snacks to take control of the Gujarat market. We would be needing another Rs 100-150 crore in next two to three years time for that expansion

On New Launches - Planning to take Avadh outside Gujarat to Maharashtra. We plan to start one plant in Mumbai. There is a sweet snack category where we are planning to launch three-four products in near future. Compared to savoury snacks, sweet snacks is a 50% to 60% higher margin product. Currently it counts for 3% to 4% of the revenue and we target this to be 10% of the revenue in next three years’ time.

On Growth Guidance - We hope to grow by 20% to 22% in next three-four years time.

Source :

CP Gurnani of Tech Mahindra

On Impact of US Govt Shutdown and Brexit - I would not immediately react to this because I have seen that IT is a lag industry. It is not like change in food or oil prices changing your behaviour overnight. The impact, if any, is two to three quarters away. I would wait and watch and do my scenario modelling but many a times, it works out as an opportunity. Ultimately where is IT budget going? It is going to run the operations, to change the operations or to grow new businesses.

On Price Aggression - With discord computing or ARVR or data to AI kind of a solution, you are in a good position and more often than not, you are putting in the tail-end which is premium, which is not so easily available and you are also solving some of the customer challenges that the customer is willing to pay for.

On Digital Investments - After a certain point, digital will become hygiene. But for the next 18 months. we are still talking digital and after 18 months when 5G becomes centrestage, we will talk digital plus 5G.

Source :

Madhu Alexiouse of Muthoot Capital

On Digitisation and Business Model – One of the driving force is spreading across the geography, we are now present in 20 states. Processes are digitally driven which have helped in reducing Opex. Opex to NII has come down by 10%. We have a unique business model where our flagship company Muthoot Fincorp which has 3600 branches cross sells two wheelers and contribute business to us at low cost

On New Products  – Muthoot Capital focus is on small ticket loans, we focus mainly on 2 wheeler loans and intend to expand to used cars and consumer durables. We have no plans to expand into SME and MSME lending

Source :

H.M. Bangur of Shree Cement

On Demand and PricingPrices are more or less stable. For last 4 years the profitability of the company is not increasing at all. Impression is cement prices go up only. Even if we see price rise of 3-4% annually, inflation is little more so profitability is impacted continously. Demand is good. Country is growing at 7.5% GDP. All India Cement demand is also growing at 7-8%

Source :

Sundeep Sikka of Reliance Nippon AMC

On Opputunity Size and Consolidation in Industry – We believe that the opportunity is humongous. We have about 45 AMC’s. Even today only 2-3% of population is investing. As India moves from 2tn$ economy to 5tn$ economy the per capita income goes up. India does not have a very high social security system, so people will be using Mututal Funds for their retirement planning and other goal based. We believe the No. of investor in industry to be increased by 5 times in next 10 years. More than 50% of AMC’s are still in losses. The share of Top 10 AMC’s in overall AUM’s went up from 75% to 81%. So there is a lot of scope of consolidation happening in the industry.

Source :