BSE Shares See Fresh Mutual Fund Buying In August As NSE Listing Nears

The race between India’s two leading stock exchanges is entering a new phase, with the National Stock Exchange set to make its market debut on September 24. BSE, meanwhile, has continued to gain ground in the listed market, with its shares up 23% so far this year and nearly 50% over the past 12 months as of September 22.

That rally has coincided with increased institutional interest in the exchange. Mutual funds added a net 25.36 lakh BSE shares in August, with buying spread across several large fund houses.

ICICI Prudential Large Cap Fund was among the biggest buyers, adding 16.19 lakh shares, while SBI Flexicap Fund increased its holding by 10.33 lakh shares. The numbers offer a glimpse into how fund managers are positioning their portfolios just before NSE becomes a listed peer.

BSE Mutual Fund Buying In August

ICICI Prudential Mutual Fund was among the most active buyers. ICICI Prudential Large Cap Fund added 16.19 lakh BSE shares in August, while ICICI Prudential Focused Equity Fund added 11.99 lakh shares. The AMC’s Banking & Financial Services Fund also added 5.63 lakh shares.

SBI Mutual Fund also built fresh positions across several schemes. SBI Flexicap Fund added 10.33 lakh BSE shares, while SBI Multicap Fund bought 8 lakh shares. SBI Quality Fund added another 1.58 lakh shares.

Other fund houses also increased exposure. Aditya Birla Sun Life Midcap Fund added nearly 1.56 lakh shares, while HDFC Banking & Financial Services Fund bought 75,000 shares.

Invesco India ELSS Tax Saver Fund added nearly 69,000 shares, while Mirae Asset Midcap Fund bought around 67,000 shares. DSP Banking & Financial Services Fund, UTI Banking & Financial Services Fund and Kotak Services Fund were among the other schemes that added BSE shares during the month.

The August activity is notable because several of these were fresh positions rather than simply increases to an existing holding. ICICI Prudential Large Cap Fund, ICICI Prudential Focused Equity Fund and SBI Flexicap Fund were among the schemes that initiated new positions in BSE during the month.

BSE has benefited from a sharp expansion in its derivatives business, which has become an important driver of the exchange’s financial performance. The company’s growing activity in index derivatives has also pushed its stock sharply higher over the past year, although the shares have remained volatile.

The arrival of NSE as a listed company now adds a new dimension to the exchange trade. NSE’s IPO has already attracted strong institutional demand, and its listing will allow investors to compare the two exchanges using publicly available market valuations and financial results.

For mutual funds, however, the August data shows that BSE exposure was already expanding across a range of portfolios before NSE entered the market. Whether that positioning changes after NSE becomes listed will depend on how fund managers assess valuations, earnings growth and the competitive dynamics between the two exchanges.

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