FPI flow into equities come down in April-June quarter; these companies see highest surge in stake

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Published: August 21, 2019 3:41:34 PM

Equities worth Rs 31,700 crore were purchased by the foreign portfolio investors (FPIs) in the April-June quarter of 2019, with diversified financials, insurance, oil, gas and consumable fuels and telecommunication services seeing maximum buying, Kotak Securities said in a report.

The banks, diversified financials and IT services were the sectors that FPIs were overweight on, the report also said.

Equities worth Rs 31,700 crore were purchased by the foreign portfolio investors (FPIs) in the April-June quarter of 2019, with diversified financials, insurance, oil, gas and consumable fuels and telecommunication services seeing maximum buying, Kotak Securities said in a report. In the January-March quarter, the FPIs were net buyers of 46,939 crore of equities. Gruh Finance, Mahindra Logistics, Godrej Properties witnessed the highest increase in stake by the FPIs, while Emami, Shriram Transport, Vodafone Idea saw mutual funds (MFs) taking large stakes, the report added. The banking financial institutions (BFIs) had gained stakes in MMFSL, Magma Fincorp, Piramal Enterprises.

The highest decrease in stake by FPIs was seen in Yes Bank, DishTV, DLF,  while the highest decrease by the mutual funds were in India Cements, Appllo Tyres and Yes Bank, the report added. The BFIs decreased their stake in BHEL, Indraprastha Gas and Power Grid. In April-June quarter, diversified financials, insurance and telecom sector stocks were bought by FPIs, while the MFs bought banks, pharmaceuticals, telecom and the BFIs sold stocks of capital goods, commodity chemicals and electric utilities.

The banks, diversified financials and IT services were the sectors that FPIs were overweight on, the report also said. The foreign investors were underweight on consumer staples and capital goods. The mutual funds were overweight on banks, capital goods and electric utilities and underweight on consumer staples, diversified financials and IT services .

In the budget presented in July this year, the government had proposed to raise the surcharge to 25 per cent, from 15 per cent on taxable income between Rs 2 crore and Rs 5 crore, and 37 per cent, from 15 per cent for income above Rs 5 crore. This led to sell-off in the stock market, with foreign investors turning net sellers. However, the government, last week, held meetings with representatives of FPIs to assuage their concerns and reports suggest it may come up with measures to recover the overseas investors’ trust.

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