- Mutual funds increased exposure to banking, oil & gas, internet, and new tech stocks in May 2026
- Funds trimmed holdings in IT services, metals, and power equipment due to valuation and earnings concerns
- Top large-cap buys included ICICI Bank, HDFC Bank, Adani Enterprises, Reliance Industries, and Eternal Ltd
Mutual funds turned more tactical in May 2026, increasing exposure to banking, oil and gas, internet and new-age technology stocks, while sharply trimming holdings in IT, metals, and power equipment names. The sectoral reshuffle comes as fund managers continue to deploy inflows into large private lenders and internet-focused businesses, while booking profits in pockets that have seen strong rallies over the past year.
Banking stocks attracted the strongest buying interest from mutual funds during the month, alongside oil & gas companies and new-age technology and internet businesses.
On the other hand, fund managers reduced exposure to IT services companies, metals stocks and power equipment makers, suggesting caution toward sectors facing valuation concerns and near-term earnings uncertainties.
Large-Cap Activity: Private Banks Back in Favour
Among large-cap stocks, mutual fund houses increased exposure in ICICI Bank, HDFC Bank, Adani Enterprises, Reliance Industries and Eternal.
On the selling side, funds reduced exposure to Infosys, Vedanta, Bank of Baroda, State Bank of India and Polycab India.
Mid-Cap Activity: Internet And Energy Themes Gain Traction
In the mid-cap segment, mutual funds added exposure to Lenskart, Billionbrains (Groww), JSW Energy, PB Fintech and Indus Towers.
Meanwhile, holdings in GE Vernova T&D, BSE, Hitachi Energy, Oracle Financial Services Software and SAIL were pared.
Smallcap Activity: Gas Utilities Preferred
Among small-cap stocks, mutual funds bought Gujarat Gas, Indraprastha Gas, Sona BLW Precision Forgings, Pine Labs and Bandhan Bank.
Selling was seen in MTAR Technologies, Cohance Lifesciences, GE Shipping, E2E Networks and CEAT.
At A Glance
Top five stocks bought by mutual funds:
- Large cap: ICICI Bank, HDFC Bank, Adani Ent, Reliance Ind, & Eternal Ltd.
- Mid-caps: Lenskart, Billionbrains (Groww), JSW Energy, PB Fintech, & Indus Towers
- Small-caps: Gujarat Gas, Indraprastha Gas, Sona BLW, Pine Labs, and Bandhan Bank
Top five stocks sold by mutual funds:
- Large cap: Infosys, Vedanta, Bank of Baroda, SBI, and Polycab India
- Mid-caps: GE Vernova T&D, BSE, Hitachi Energy, Oracle Fin Serv, and SAIL
- Small-caps: MTAR Tech, Cohance Lifesciences, GE Shipping, E2E Networks, and CEAT
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