Quant Mutual Fund Reports Record High AUM At Rs 94,000 Crore Amid SEBI Crackdown; New Portfolio Changes?

Quant Mutual Fund (MF), currently under the scanner of the Securities and Exchange Board of India (SEBI) for alleged irregularities, has reached record levels in both its assets under management (AUM) and net asset values (NAV). Despite facing net outflows, Quant MF has managed to sustain robust liquidity, showcasing its ability to navigate through challenging times.

As of July 12, 2024, Quant Mutual Fund's AUM surpassed Rs 94,000 crore, setting an all-time high. This achievement comes in the wake of net outflows amounting to Rs 696 crore over the past three weeks and equity outflows of Rs 877 crore, which represent less than 1% of the total AUM. Despite these outflows, Quant MF maintains a strong liquidity position with more than 54% of its assets held in highly liquid instruments, including large-cap stocks, Treasury bills (T-bills), government securities (G-Secs), gold, and silver.

In a recent notice to its unitholders, Quant Mutual Fund highlighted several key statistics and milestones:

Total AUM: Over Rs 94,000 crore, an all-time high as of July 12, 2024.
NAVs: Most schemes have NAVs at or near their all-time highs.
Total Folios: Approximately 80 lakh, marking an all-time high as of June 30, 2024.

According to corporate shareholding data filed for June 30, 2024, Quant Mutual Fund holds 106 stocks with a net worth exceeding Rs 44,996.3 crore. The fund's top holdings have seen significant changes, particularly in major companies like HDFC Bank and Reliance Industries.

HDFC Bank

Quant MF significantly increased its stake in HDFC Bank, investing approximately Rs 4,800 crore in June and Rs 2,669 crore in May. This brought its total holding in HDFC Bank to Rs 7,755 crore, up from Rs 2,671 crore in May, as reported by Trendlyne.

Reliance Industries

The fund also increased its stake in Reliance Industries, a leading conglomerate. This decision aligns with Quant MF's strategy of investing in blue-chip companies with robust growth prospects.

Quant MF has actively adjusted its portfolio in recent months. In June 2024, the fund allocated around Rs 8,700 crore across 189 stocks. This follows a Rs 12,500 crore investment in 178 stocks in May and Rs 4,070 crore in 179 stocks in April, according to Moneycontrol.

New Additions

The fund made several notable additions to its portfolio, including:
Ramco Cements: An investment of Rs 453 crore.
Grasim Industries: An investment of Rs 152 crore.
Gail India: An investment of Rs 118 crore.
Other new stocks in the portfolio include Bharat Forge, Birlasoft Ltd, Gillette India, and SBI Life Insurance, further diversifying Quant MF's holdings.

Quant MF also exited 11 stocks, with the largest sale being Hindalco Industries, worth Rs 656 crore, followed by BHEL and NLC India. These strategic exits indicate a reallocation of resources towards more promising investment opportunities.

Market Inflows and Cash Reserves

Quant MF received total inflows of Rs 2,570 crore across its 21 schemes in June, down from Rs 5,349 crore in May and Rs 4,997 crore in April. Despite this decline in inflows, the fund held cash reserves of Rs 4,136 crore at the end of June, up from Rs 3,282 crore in May but slightly down from Rs 4,417 crore in April.

SEBI Scrutiny

The ongoing SEBI investigation into Quant Mutual Fund's operations has undoubtedly cast a shadow over its recent achievements. However, the fund's management remains optimistic, emphasizing transparency and adherence to regulatory standards. The notice to unitholders reiterated Quant MF's focus on maintaining high ethical standards and ensuring compliance with all regulatory requirements.