Axis Asset Management Company’s PMS strategy has offloaded its stakes in Avenue Supermarts (DMart) and REC Limited. Fund managers cited rising retail competition and credit risks in the power sector as key drivers. The fund has rotated capital into fintech companies, marking a change in strategy following the recent consolidation of the Axis PMS business.
Axis Asset Management Company (AMC) has adjusted its Pure Contra PMS portfolio by selling its entire holdings in retail chain Avenue Supermarts (DMart) and power lender REC Limited. This move reflects a shift in how the portfolio managers are viewing specific sectors amid changing market dynamics.
The decision to exit DMart was driven by the rapid growth of quick-commerce platforms. These 10-to-15-minute delivery services are creating intense competition for traditional hypermarket operators. The fund managers indicated that this trend could continue to put pressure on the profit margins of large supermarket chains, leading them to reduce their exposure to the segment.
Simultaneously, the divestment from REC Limited stems from a cautious stance on non-banking financial companies (NBFCs) that have high exposure to state-run power distribution utilities. The managers noted concerns about the credit quality of these utilities, which prompted a defensive move to protect the portfolio from potential repayment risks or sector slowdowns.
Following these exits, the fund has reallocated capital into the financial services sector. It has initiated new positions in One 97 Communications (Paytm) and Jio Financial Services. This move highlights a strategy to tap into the evolving digital financial services space, which has now become the largest sectoral allocation for this PMS strategy at 32.6%.
These portfolio changes coincide with an organizational update within the fund house. As of July 2026, the PMS business, which was previously managed by Axis Securities, was transferred to the core Axis AMC entity. This consolidation has brought together thousands of investors under the new 'Alternates by Axis AMC' brand, with Naveen Kulkarni taking over as the Chief Investment Officer for these portfolios.
Since its inception in November 2020, the Pure Contra strategy has aimed to navigate market cycles by taking contrarian positions. For investors, the key monitorable remains how these new fintech bets perform against the backdrop of changing regulatory and competitive environments in the digital finance space. Meanwhile, the broader performance of the portfolio will depend on how effectively the fund manages sector-specific risks, such as the ongoing impact of quick commerce on traditional retail models and credit quality in the power finance segment.