 "Analysis: FIIs stake in 18 Nifty companies at record high")
FIIs, the main driver of Indian stocks, stake in 18 of the 50 Nifty companies have touched to historic highs, while in 7 other companies was nearing record highs in the March 2013 quarter, according to latest quarterly shareholding information filed by these companies. FIIs had a record stake in six Nifty companies during the year ago quarter.
FIIs holdings in six companies – HDFC Bank, Lupin, Mahindra and Mahindra (M&M), NTPC, Axis Bank and DLF have touched a record high in January – March 2013 quarter. They have increased their stakes between one – six percentage points in these companies during the quarter.
In the private sector bank - Axis Bank, state-owned power company – NTPC and real estate major – DLF, the overseas investors raised their holding by subscribing to shares via private placements route and used the open market purchase route to up their stake in HDFC Bank, Lupin and M&M.
“The FIIs now prefer to invest in index-based companies. They realise that the overall depth of the market is shallow and it is better to be selective. We have also seen that there is smart money, or short term money, that gets invested into Nifty and Nifty option index-based stocks,” suggests Ashu Madan, chief operating officer, Religare Securities.
Record flows
A record net inflow in Indian equities in the financial year ending March 2013 helped overseas investors to tighten their grip on the Indian equity. FIIs pumped in more money in FY13 than they have in any year since they were permitted to invest in these, 21 years ago. They were net buyers by $25.8 billion or Rs 1.4 lakh crore during the fiscal, according to data from the stock market regulator, the Securities and Exchange Board of India (Sebi).
“Election year discounted, I think we would probably see at least the same amount of flows in 2013 as seen in 2012,” said Deven Choksey, managing director, KR Choksey Securities.
433 stocks for which latest data is available among the companies that comprise CNX 500, in 128 companies FIIs' were the single largest shareholders in non-promoter categories. These 128 companies account almost half or 48 per cent of the total market capitalisation of the Bombay Stock Exchange (BSE).
“The FIIs invested in emerging market like India where the GDP was still growing at a significantly higher rate compared to the developed markets like Europe and the US,” says Sudip Bandyopadhyay, MD and CEO of Destimoney Securities.
Notes G Chokkalingam, executive director and chief investment officer, Centrum Wealth Management: “Attractive valuation of the overall markets, far more attractiveness of individual stocks and possible upgrades to both GDP growth and corporate earnings consequent to further reversal of interest rate cycle will ensure that there is no serious run down in the investments of FIIs in the country.”
Of these 433 stocks, in 103 stocks, FIIs currently holds more than 20 percentage points stake at the end of March 2013 quarter. In 121 companies their holdings are between 10-20 percentage points and in 61 stocks in the range of 5-10 percentage points, the data shows.
Allocation
Among the sectoral classification, FIIs bought heavily in the financials including banking, fast moving consumer goods (FMCG), pharmaceutical, consumer durables, information technology (IT), entertainment, power generation and refineries stocks.
Ipca Laboratories, Cipla, Wockhardt, Biocon and GlaxoSmithKline Pharmaceuticals from pharma, HDFC, Dena Bank and Kotak Mahindra Bank from financials and HCL Technologies, Tech Mahindra and MphasiS from the IT sector have seen more than four percentage points each increase in FIIs stakes in FY13.
“Going ahead, if the FII inflow continues, the money will flow into these select stocks only. Select FMCG and pharma stocks still look positive. Given the uncertain times, defensive bets do look promising. The banking pack also looks promising, led by private banks. In terms of specific stocks, they can increase their holding in the ones that already form a part of their portfolio,” adds Madan of Religare Securities.
On the other hand, Choksey suggests that in the current year, FIIs attention would get invited in select capital goods and infrastructure related stocks. “In terms of stocks, Bhel, Bharat Forge, Thermax, ONGC, RIL and Crompton Greaves should get attention. I don’t expect FMCG and the IT sector cornering a large chunk of investment going ahead,” he says.
Name Mar-12 Dec-12 Mar-13 Chg* ACC 18.25 19.97 19.95 1.70 Ambuja Cements 25.79 28.84 30.07 4.28 Asian Paints 17.87 18.64 19.44 1.57 Axis Bank 32.94 34.83 40.94 8.00 Bajaj Auto 16.42 17.04 18.20 1.78 Bank of Baroda 13.54 16.12 16.67 3.13 Bharti Airtel 16.93 17.28 17.24 0.31 BHEL 13.49 14.92 14.75 1.26 BPCL 7.91 10.04 10.36 2.45 Cairn India 7.35 14.97 14.56 7.21 Cipla 16.07 22.24 23.89 7.82 Coal India 5.44 5.64 5.44 0.00 DLF 15.47 14.87 16.64 1.17 Dr Reddy's Labs 27.42 26.17 29.66 2.24 GAIL (India) 13.28 15.59 15.79 2.51 Grasim Inds 23.46 23.39 23.35 -0.11 HCL Technologies 19.42 21.80 24.32 4.90 HDFC 66.24 73.17 73.67 7.43 HDFC Bank 30.68 33.66 34.07 3.39 Hero Motocorp 33.38 31.99 30.57 -2.81 Hindalco Inds 26.85 27.16 24.47 -2.38 Hindustan Unilever 19.43 21.68 22.11 2.68 ICICI Bank 35.79 37.07 37.92 2.13 IDFC 48.52 53.16 53.23 4.71 IndusInd Bank 34.99 39.05 40.49 5.50 Infosys 39.02 40.55 40.52 1.50 ITC 17.40 18.77 19.68 2.28 Jindal Steel 22.14 22.80 21.74 -0.40 JP Associates 19.73 22.02 22.77 3.04 Kotak Mahindra Bank 28.24 30.42 32.15 3.91 Larsen & Toubro 15.62 16.73 16.58 0.96 Lupin 27.52 27.76 28.80 1.28 M&M 26.48 32.86 35.01 8.53 Maruti Suzuki 21.45 23.13 22.36 0.91 NMDC 0.70 4.40 4.76 4.06 NTPC 4.02 4.39 9.37 5.35 ONGC 5.48 5.79 6.27 0.79 Power Grid Corpn 12.93 14.26 14.09 1.16 Punjab National Bank 17.38 17.94 17.96 0.58 Ranbaxy Labs 9.56 10.65 10.55 0.99 Reliance Inds 17.55 17.79 17.76 0.21 Reliance Infra 15.15 16.11 15.02 -0.13 SBI 8.70 9.69 10.74 2.04 Sesa Goa 24.97 27.31 27.23 2.26 Sun Pharma 19.97 21.45 22.61 2.64 Tata Motors 27.62 28.72 28.11 0.49 Tata Power 21.87 24.95 24.54 2.67 Tata Steel 14.36 14.77 13.85 -0.51 TCS 14.02 14.96 16.14 2.12 UltraTech Cement 17.74 20.17 20.64 2.90
FIIs holdings in six companies – HDFC Bank, Lupin, Mahindra and Mahindra (M&M), NTPC, Axis Bank and DLF have touched a record high in January – March 2013 quarter. They have increased their stakes between one – six percentage points in these companies during the quarter.
In the private sector bank - Axis Bank, state-owned power company – NTPC and real estate major – DLF, the overseas investors raised their holding by subscribing to shares via private placements route and used the open market purchase route to up their stake in HDFC Bank, Lupin and M&M.
“The FIIs now prefer to invest in index-based companies. They realise that the overall depth of the market is shallow and it is better to be selective. We have also seen that there is smart money, or short term money, that gets invested into Nifty and Nifty option index-based stocks,” suggests Ashu Madan, chief operating officer, Religare Securities.
Record flows
A record net inflow in Indian equities in the financial year ending March 2013 helped overseas investors to tighten their grip on the Indian equity. FIIs pumped in more money in FY13 than they have in any year since they were permitted to invest in these, 21 years ago. They were net buyers by $25.8 billion or Rs 1.4 lakh crore during the fiscal, according to data from the stock market regulator, the Securities and Exchange Board of India (Sebi).
“Election year discounted, I think we would probably see at least the same amount of flows in 2013 as seen in 2012,” said Deven Choksey, managing director, KR Choksey Securities.
433 stocks for which latest data is available among the companies that comprise CNX 500, in 128 companies FIIs' were the single largest shareholders in non-promoter categories. These 128 companies account almost half or 48 per cent of the total market capitalisation of the Bombay Stock Exchange (BSE).
“The FIIs invested in emerging market like India where the GDP was still growing at a significantly higher rate compared to the developed markets like Europe and the US,” says Sudip Bandyopadhyay, MD and CEO of Destimoney Securities.
Notes G Chokkalingam, executive director and chief investment officer, Centrum Wealth Management: “Attractive valuation of the overall markets, far more attractiveness of individual stocks and possible upgrades to both GDP growth and corporate earnings consequent to further reversal of interest rate cycle will ensure that there is no serious run down in the investments of FIIs in the country.”
Of these 433 stocks, in 103 stocks, FIIs currently holds more than 20 percentage points stake at the end of March 2013 quarter. In 121 companies their holdings are between 10-20 percentage points and in 61 stocks in the range of 5-10 percentage points, the data shows.
Allocation
Among the sectoral classification, FIIs bought heavily in the financials including banking, fast moving consumer goods (FMCG), pharmaceutical, consumer durables, information technology (IT), entertainment, power generation and refineries stocks.
Ipca Laboratories, Cipla, Wockhardt, Biocon and GlaxoSmithKline Pharmaceuticals from pharma, HDFC, Dena Bank and Kotak Mahindra Bank from financials and HCL Technologies, Tech Mahindra and MphasiS from the IT sector have seen more than four percentage points each increase in FIIs stakes in FY13.
“Going ahead, if the FII inflow continues, the money will flow into these select stocks only. Select FMCG and pharma stocks still look positive. Given the uncertain times, defensive bets do look promising. The banking pack also looks promising, led by private banks. In terms of specific stocks, they can increase their holding in the ones that already form a part of their portfolio,” adds Madan of Religare Securities.
On the other hand, Choksey suggests that in the current year, FIIs attention would get invited in select capital goods and infrastructure related stocks. “In terms of stocks, Bhel, Bharat Forge, Thermax, ONGC, RIL and Crompton Greaves should get attention. I don’t expect FMCG and the IT sector cornering a large chunk of investment going ahead,” he says.
| in % | FIIs stake in Nifty companies | |||