Fund managers opted for safety and predictability in their stock pickings in March when the Sensex and Nifty dropped 23%. They bought shares of companies with relatively low beta, fairly good dividend yield, good market share in their business and strong backing of the government, which lowers the probability of default on payments. Their top stock picks were public sector undertakings (PSU companies) which offer reasonably good dividend yield, have high market share in their line of business and stability of earnings due to their favourable business models. In the private sector, they bought shares of companies with dominant market share. Here is the lowdown on five companies which managers of leading fund houses bought in March this year. Coal India CMP: Rs 145 Market cap: Rs 90,566 crore Bought by: HDFC MF A few fundamental factors make Coal India one of the most interesting ideas in the current extremely volatile phase of markets. Coal India has net cash balance of close to Rs 29,500 crore as of FY20. It has dividend yield of 9.34%. If one discounts the fact of low industrial production data largely due to the lockdown restrictions, the company’s business model remains intact. It is the… Read full this story
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