Looking for value bets? ICICI Prudential MF picked these stocks in February

Amid the ongoing uncertainty in the domestic equity market, the country's second-largest fund manager ICICI Prudential Mutual Fund zeroed in on select underperforming themes -- IT majors, oil & gas and auto players -- in February. The benchmark BSE Sensex slipped over 3 per cent last month due to heavy selling by foreign institutional investors (FII), war between Russia and Ukraine and concerns over rising inflation.

Data available with Prime Mutual Fund Database showed that the fund house increased stake in FMCG major ITC, telecom player Bharti Airtel and select banking stocks, including Federal Bank, Equitas Small Finance Bank and State Bank of India. It lapped up somewhere between 95 lakh-1.50 crore of shares of these companies last month.

Commenting on the strategy, Chintan Haria, head-product development and strategy at ICICI Prudential AMC, said, "ICICI Prudential has been on the buy-side as whenever markets correct we have funds like balance advantage which are mandated to buy as markets become cheaper because when the market was expensive, such funds would have raised cash to invest in times like current market conditions."

ICICI Prudential Mutual Fund also bought over 35 lakh shares of Motherson Sumi Systems, Wipro, Oil & Natural Gas Corporation, Infosys, Power Grid, HCL Technologies, SBI Life Insurance, Lupin, Aditya Birla Capital, Mahindra & Mahindra, HDFC and Bank of Baroda.

"Across all our funds, we are investing in sectors where we find value and has the potential to deliver good long term risk-adjusted return. These are typically sectors which have underperformed and are relatively cheap but have good growth prospects over the next two to three years," Haria added.

Historical returns also showed that ICICI Prudential's funds have managed to deliver a robust return to investors in the past two years. For instance, ICICI Prudential’s Bluechip Fund and Large & Mid Cap Fund have gained 28.10 per cent and 32.34 per cent, respectively, since March 9, 2020. The money manager believes that the current market correction offers a very good opportunity to invest systematically over the next 12 to 18 months.

ICICI Bank, Cipla, ICICI Prudential Life Insurance, Tech Mahindra, Mahindra & Mahindra Financial Services, Manappuram Finance, IDFC, Zydus Lifesciences, Max Financial Services and Jamna Auto stood among the other firms in which the mutual fund raised its stake in February.

On the other hand, it sold over 20 lakh shares of Axis Bank, Thomas Cook (India), Ashok Leyland, Oil India, NTPC, Karur Vysya Bank, Vedanta, Punjab National Bank and Hindalco Industries, among others.

Vedanta Fashions, Techno Electric & Engineering and GMR Infrastructure stood as new entrants in the portfolio, while it completely exited stocks like Metro Brands and Sansera Engineering.