Summary of this article
Mutual funds net buyers as FIIs continued selling
Banks dominated large-cap mutual fund purchases
Mid and small caps saw selective accumulation
Infosys, Reliance among top mutual fund exits
Mutual funds emerged as strong net buyers in the Indian secondary market in December 2025, even as foreign institutional investors (FIIs) continued to pare exposure. Mutual funds bought equities worth Rs 38,900 crore during the month, while FIIs sold Rs 31,400 crore, according to data from Nuvama Institutional Equities. The divergence in flows was reflected in stock level activity across market cap segments, portfolio reshuffles, and fund house strategies.
Within pure equity schemes, large-cap buying by mutual funds was concentrated in ICICI Bank, HDFC Bank, Shriram Finance, Tech Mahindra, and Kotak Mahindra Bank. On the selling side, funds trimmed exposure to Infosys, State Bank of India, Maruti Suzuki, Bajaj Finance, and Reliance Industries.
In the mid-cap space, Bank of Maharashtra, JSW Energy, Colgate Palmolive, Delhivery, and Ipca Laboratories saw notable additions, while Dixon Technologies, Cummins India, Aditya Birla Capital, Indus Towers, and KEI Industries faced reductions.
Small-cap buying was led by City Union Bank, Akzo Nobel India, Kirloskar Oil Engines, Cholamandalam Financial Holdings, and Craftsman Automation, whereas Kaynes Technology, Multi Commodity Exchange, Brigade Enterprises, Hitachi Energy, and Ador Welding witnessed the highest selling.
New small-cap entries, as per the data, included Inox Green Energy Services, Shipping Corporation of India, Indian Metals & Ferro Alloys, Borosil Renewables, and Datamatics Global Services, while complete exits were seen in Gandhar Oil Refinery, Praveg, Taj GVK Hotels, Knowledge Marine & Engineering Works, and others.
Looking across equity schemes on an industry-wide basis, mutual funds added exposure to a mix of financials, consumption, and new-age names. The largest additions were ICICI Prudential AMC worth Rs 6,000 crore, InterGlobe Aviation (Rs 5,800 crore), and Swiggy (Rs 5,600 crore). On the reduction side, Infosys saw the sharpest cut at Rs 8,500 crore, followed by Vedanta (Rs 1,600 crore) and Bajaj Finance (Rs 1,500 crore).
Within mid-cap equity schemes, key additions included Belrise Industries (Rs 900 crore), Privi Speciality Chemicals (Rs 700 crore), and Akzo Nobel India (Rs 600 crore), while Kaynes Technology (Rs 800 crore), HFCL (Rs 500 crore), and Nazara Technologies (Rs 400 crore) were among the key reductions. In small-cap schemes, funds added CORONA Remedies (Rs 500 crore), Wakefit Innovations (Rs 500 crore), and Akums Drugs (Rs 300 crore), while exposure was pared marginally in Zee Entertainment, GHCL, and Neogen Chemicals, each by about Rs 100 crore.
Top Additions and Reductions for Three Consecutive Months by Mutual Funds
Over the last three consecutive months, large-cap additions were led by HDFC Bank, ICICI Bank, ITC, Kotak Mahindra Bank, and Hindustan Aeronautics, while Reliance Industries, State Bank of India, Life Insurance Corporation, Sun Pharma, and ONGC saw reductions. Mid-cap buying focused on Container Corporation, Dalmia Bharat, 3M India, Astral, and UCO Bank, while small-cap additions included Olectra Greentech, Vesuvius India, and GR Infraprojects.
