Parag Parikh Flexi Cap Fund defies ESG mania to bet big on this PSU stock

NEW DELHI: Bucking the increasingly-popular trend of keeping ESG parameters in mind while picking stocks, one of India’s most popular mutual funds – Parag Parikh Flexi Cap Fund – has hiked its stake in PSU stock . Based on the timeless principles of value investing, the mutual fund picked up 5.84 crore shares of the anti-ESG stock in June.

The monthly portfolio disclosure shows that Coal India, which is the world’s largest producer of fossil fuel, comprised over 5 per cent of the AUM of the fund. The fund manager Rajeev Thakkar also chose to stay put in old favourite

stock, which is also low on ESG parameters as a large bulk of its revenues come from cigarettes.

Interestingly, both ITC and Coal India are among the top performers in Nifty this year. On a YTD (year-to-date) basis, ITC is up 35 per cent and Coal India 32 per cent. Both the anti-ESG stocks are also high dividend paying stocks.

At current market prices, ITC’s dividend yield adds up to about 4 per cent, while that of Coal India is around 8.7 per cent.

Thakkar also hiked his stake in merger-bound

as he picked up over 15 lakh shares of the mortgage lender, its third-largest bet after and ITC. Other financials in the portfolio include and .

The popular mutual fund scheme, which has assets under management worth over Rs 22,000 crore, holds 22 listed Indian stocks and four US stocks – Alphabet, Microsoft, Amazon and Meta Platforms. It also holds a small stake in the unlisted Suzuki Motor Corporation.

During June, the fund also took advantage of the tech crash in Nasdaq and hiked its stake in Amazon, which now forms nearly 5 per cent of the portfolio. The flexicap fund is known to pick stocks with low debt, high cash flows and those quoting at a discount to their intrinsic value.

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