An analysis of portfolio holdings in equity of the top ten AMCs in India along with their top ten holdings in equity stocks shows that the portfolio holdings of AMCs comprise quite a few common stocks indicating preference towards a select group of stocks.
Although there are regulations limiting the exposure of AMCs/ schemes to particular scrip, a significantly high degree of concentration by the mutual fund sector may have implications for stability of the securities market as well as on the performance of the individual AMCs too. I would urge the concerned Audit Committee to make it a part of their review process. IFRS implementation challenges 14.