Changing investor behaviour

Marquee mutual fund investments in Tata group companies are changing fast since the Cyrus Mistry fiasco last year
Changing investor behaviour
Changing investor behaviour

A lot can be said about institutional investors in a publicly listed company and how their investments vary with change in the management. Over the past six months a lot has changed at Bombay House, the headquarters of Tata Sons, the holding company of many Tata group entities. Although the reason behind the ouster of former chairman Cyrus Mistry is not clear, investors first rushed in to increase their stake in select group companies when Ratan Tata made a comeback as acting chairman of Tata Sons. With Natarajan Chandrasekaran at the helm now, mutual funds are yet again changing their holdings in the group companies.

Mutual Fund Holdings during Cyrus Mistry's tenure, Former chairman, Tata Group

Though the immediate reaction of the mutual funds were negative about the Tata group stocks post the replacement of Cyrus Mistry as the Chairman, however in the subsequent months they started adding these stocks (except of Tata Power) in their portfolios.

With N Chandrasekaran’s appointment as the Chairman of Tata Sons, the Mutual Funds were seen offloading their stakes in TCS, Tata Motors and Tata Power in the month of January 2017.

Mutual Fund Holdings during Ratan Tata's tenure, Former Chairman, Tata Group

We saw mutual funds buying heavily in Tata Motors in the month of October and November but with demonetisation the sales growth were impacted and the mutual funds turned out to be net sellers in the subsequent two months. However, Tata Motors DVR continues to remain popular among the mutual funds and kept increasing exposure in the stock.

Mutual Fund Holdings during Natarajan Chandrasekaran's tenure, Chairman of Tata Group

Source: Morningstar 

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