How MFs churned large caps, mid-caps, and small caps in September 2026

How MFs churned large caps, mid-caps, and small caps in September 2026

Here is a quick look at how mutual funds churned their portfolios in September 2026 at a macro level. It is a macro view of all the mutual funds combined, and then a granular 360-degree view how the holdings shifted within large cap, mid-cap, and small cap stocks. It must be noted that this is across equity transactions in equity funds, passive funds, and hybrid funds.

MUTUAL FUNDS - LARGE CAP CHURN IN SEPTEMBER 2026

The table below captures the 5 large cap stocks seeing the biggest percent increase in MF holdings and the 5 large caps with the biggest percent fall in holdings in September 2026.

Let us look at the large cap buy side first. It is a fairly diverse play on the buy side with stocks spread across sectors. Mazagon Docks has attracted interest due to the massive order farm outs in defence. HZL continues to be a low-risk play on the commodity space. Titan has flattered the street with its guidance on Q2. Adani group is quite prominent among the top 10 buys for the month. One surprising buy has been Indigo Airways, despite the pressure on costs and revenues. However, its dominant 65% market share remains a big advantage.

What about the MF selling in large caps? Some of the financials like Bajaj Finance and Bajaj Housing Finance came under selling pressure ahead of a near-certain rate hike by the RBI. In the case of Siemens Energy and CG Power, it looks more like a case of taking profits at a higher level. Tata Motors remained under pressure amid pressure on rural demand due to falling farm incomes this year. Healthcare stocks like Zydus and Torrent also saw selling.

MUTUAL FUNDS - MID CAP CHURN IN SEPTEMBER 2026

The table captures the 5 mid-cap stocks seeing the biggest percent increase in MF holdings and the 5 mid-caps seeing the biggest percent fall in holdings in September 2026.

Among the mid-caps, select financials like HUDCO, Bank of Maharashtra, Yes Bank, Canara Bank, and GIC Re saw buying. Most of these players are relatively defensive and not so vulnerable to a rate hike. Vodafone saw some telecom appetite shifting from Bharti Airtel as mutual funds are betting on the gradual revival of Vodafone. GMR Airports also saw selective buying on expectations of a hike in airport charges by airport operators in India.

What about the MF selling in mid-caps? The selling in IDBI Bank was expected as the deal was expected to happen at a discount to the market price. That is what happened in the Fairfax deal. Tata Elxsi continues to face pressure of weak numbers. Selling in Hero Moto and AWL Agri was more a caution play on weak rural demand. Power and electrical equipment companies saw some offloading of stocks at higher levels.

MUTUAL FUNDS - SMALL CAP CHURN IN SEPTEMBER 2026

The table captures the 5 small cap stocks seeing the biggest percent increase in MF holdings and the 5 small caps seeing the biggest fall in precent holdings in September 2026.

The small cap space, by default, happens to be a bottom-up stock specific story. This month has been no different. Many of the percentage changes may be overstated due to a low base. Kingfa has been attracting interest after the government adopted a more lenient approach towards Chinese FDI. On the sell side, Cemindia continue to see selling pressure while debt troubles at SP group showed on S&W.

Broadly, the month of September 2026 saw mutual funds continuing to be on the buy side, largely compensating for the heavy selling by FPIs. MF equity share is now almost close to FPI stake for the first time. The action appears to be more prominent in mid-caps and small caps; where the mutual funds actually see much of the alpha generated in the future.