Street signs: FPIs book gains in Infy, grey market premiums drop, and more

FPIs book gains in Infy

The recent rally in Infosys – India’s second largest software firm – has prompted several foreign portfolio investors (FPIs) to take money off the table. According to data, big ticket investors such as Nordea Bank, UBS, AGF Management and Goldman Sachs put together have sold over 10 million shares of Infosys in the past month. Similarly, domestic fund house ICICI Prudential and UTI Mutual Fund too have sold 12 million shares of the Bengaluru-based company in the same period. Interestingly, Franklin Resources purchased 3.9 million shares of the company last week – the only institution to buy large quantity of the stock during this period. Shares of Infosys are up 37 per cent this year. 

Pavan Burugula

Profit booking worries fund managers

The sharp dip on Friday has fund managers worried, and for a good reason. While inflows into systematic investment plans (SIP) are continuing, savvy investors are now beginning to book profits and preferring cash over stocks or mutual funds. “If one takes out regular SIP inflows, the growth in assets of equities has actually slowed down for some time,” says the CEO of a fund house. Fund managers feel that the government needs to work harder towards resolving problems such as IL&FS and the rupee. “The stock market is often dismissed by senior officials in the government. But it is a barometer of the economy’s success or failure. If foreign investors start moving out aggressively, we will again be in trouble,” adds the CEO.

Joydeep Ghosh

Grey market premiums drop 

Grey market premiums for shares of upcoming IPOs Aavas Financiers and Garden Reach Shipbuilders as well as the recently concluded Ircon International have seen a sharp drop. Aavas Financiers, whose Rs 17.3-billion IPO opens on Tuesday, has almost halved from 24 per cent to 14 per cent. The premium for state-owned firm Garden Reach too has declined to below 10 per cent, and the premium on Ircon too is similar. “The sharp increase in volatility is making operators nervous. Grey market premiums have come off and volumes have thinned,” said a broker.

Samie Modak