Monday, May 13, 2013

FIIs\' ownership of Indian stocks at 8-year high

13 May, 2013,NEW DELHI:

Foreign investors showed huge interest in the Indian markets during the January-March quarter of 2013 as their holding in the benchmark sensitive index Sensex has touched an eight year high in the said period, Bank of America Merrill Lynch said.

According to a research note by Bank of America Merrill Lynch, while FII holding in Sensex has gone up to the highest level in last eight years, while LIC and domestic MFs were net sellers.

During the March quarter, FIIs remained positive on the Indian markets as was reflected by the heavy buying done by the FIIs during the quarter, the report said.

Based on average prices in the BSE-500, close to USD 10 billion was pumped in the Indian equity markets by the FIIs in the quarter as compared to USD 8 billion inflow in the previous quarter, BofA ML said in the research note.

Domestic MFs on the other hand were net sellers as they sold close to USD 1 billion during last two quarters.

This is the third consecutive quarter when the Indian markets have seen significant flows from the FIIs. FII net inflow was USD 10 billion for the March quarter as compared to a USD 8 billion inflow in the previous quarter (October- December 2012), the report said.

In contrast to FIIs, domestic mutual funds sold Indian equities with an outflow of USD 1 billion in the (October- December 2012) quarter and the January-March period.

A sector-wise analysis shows that FIIs remained bullish on utilities, pharma and software this quarter. However FIIs were bearish in sectors like real estate and energy.

Meanwhile, LIC sold in shares in sectors like software, financials, pharma, while bought in sectors like metals and mining and utilities.

According to the report, the analysis for LIC is an approximation, as only those stocks where their stake is greater than 1 per cent as that is the only data publicly available at the exchange websites were taken for consideration.
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