Shares of HDFC Bank fell more than 15 per cent in March, marking their steepest monthly decline since March 2020, even as domestic mutual funds used the sharp correction to increase their exposure to the lender.
Data from the Bombay Stock Exchange showed mutual fund shareholding rose to 29.54 per cent at the end of the March quarter, up from 26.66 per cent in December. The increase largely mirrored a reduction in foreign portfolio investor (FPI) holdings, which fell to 44.05 per cent from 47.67 per cent during the same period.
Among key buyers during the correction were SBI Mutual Fund, which purchased shares worth Rs 2,614 crore, ICICI Prudential Mutual Fund with a Rs 4,574 crore investment, and HDFC Mutual Fund, which added Rs 985 crore. DSP Mutual Fund also increased its stake by Rs 753 crore, according to Nuvama Alternative & Quantitative Research.
However, not all fund houses followed suit. Axis Mutual Fund pared its holdings by Rs 421 crore, while Kotak Mutual Fund sold shares worth Rs 356 crore during the month.
Retail participation also rebounded, with the number of shareholders holding up to Rs 2 lakh worth of shares rising to 41.1 lakh from 35.39 lakh in December.
HDFC Bank shares jumped 1.84 per cent to Rs 809 on Wednesday but remained around 20 per cent below their recent 52-week high of Rs 1,020.