FIIs' stake in BSE-500 firms at new high

These companies account for nearly 93% of the total market capitalisation on the exchange

Foreign institutional investors’ average holding in BSE-500 companies hit a new high at the end of the March quarter.

According to the shareholding pattern filed by 489 companies from the BSE-500 index, their average stake in these companies rose to 19.9 per cent from 19.6 per cent at end-December 2013, itself up from 19 per cent at the end of the September 2013 quarter (and 18.59 per cent at end-March 2013).

These 500 companies account for nearly 93 per cent of the total market capitalisation on the BSE exchange.

FIIs’ stake in 109 of these 489 companies were at record highs in the March 2014 quarter. Page Industries, Apollo Tyres, UPL, Infotech Enterprises, VST Industries, Polaris Financial Technologies, Jaiprakash Associates and L&T Financial Holdings are among these.

Foreign investors’ holdings were also at a record high in 11 BSE Sensex and NSE CNX Nifty companies – Axis Bank, Cairn India, Dr Reddy’s Laboratories, HCL Technologies, HDFC, IndusInd Bank, Infosys, Mahindra and Mahindra, NMDC, Power Grid Corporation and Wipro.

FIIs put in Rs 85,444 crore ($13.9 billion) in the eight months between September 2013 and April 2014. This was a key factor in the 20 per cent surge in the benchmark indices over this period. On the other hand, the holdings of promoters and individual investors dipped to multi-year lows. Promoter and government ownership fell to 51.4 per cent in the March quarter against 52 per cent in December 2013. They’d an average 52.65 per cent stake at end-March 2013. This was mainly due to dilution of the government’s stake in state-owned companies such as Indian Oil Corporation, Engineers India and Bharat Heavy Electricals, to meet divestment targets.

In state-owned banks, the government stake declined due to allotment of equity shares to Life Insurance Corporation of India and others on a preferential basis.

 

Domestic investors, especially individuals, are keeping away from the markets, analysts say. Public shareholding has dropped to 7.68 per cent, its lowest level in eight years.

Individual public holding in Finolex Cables, Aban Offshore, VIP Industries, TVS Motor Company and Voltas declined by more than one percentage point. These stocks have rallied by 30 to 65 per cent so far in 2014. Information technology, financials, agro chemicals, automobile ancillaries, capital goods, pharmaceuticals, infrastructure, textiles and tyres were sectors which saw major buying during the January-March period.