Foreign institutional investors (FIIs) who converted total retailers last month poured $ 7.3 billion into Indian markets in March quarterly, data from Motilal Oswal showed, while local institutional investors recorded a $ 3.2 billion outflow.
FIIs increased the figure to more than 60 percent of Nifty-50 companies in QoQ, while DIIs reduced participation to 62 percent of Nifty-50 companies.
Foreign investors have raised a stake in 31 companies on Nifty50 since May 10. These include Tata Steel, Hindalco, UPL, Wipro, ONGC, BPCL, ICICI Bank, Axis Bank SBI and Bajaj Finance.
SBI Life Insurance, UPL, Hindalco, Tata Steel, Power Grid, Grasim, Hero MotoCorp, and Cipla were top stocks to see more than 1% increase in FII capture in -QoQ.
DII holdings in Nifty stocks have skyrocketed in BPCL, Bajaj Auto, IndusInd Bank, and SBI Life Insurance – more than 1% on QoQ basis.
Deep immersion in FII stock exchanges suggests that foreign investors are looking at sectors that could benefit from the increase in COVID cases as well as those sectors that could see a return in the near future as things stand.
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FIIs have increased weight in two-thirds of sectors such as Telecom, Metals, Consumer Buying, Real Estate, and DII is cutting metals on a quarterly basis.
Consequently, FIIs have risen to the stake in Telecom (+ 130bp), Metals (+100bp), Consumer Durables (+100bp), Real Estate (+80bp), Cement (+ 60bp), Chemicals (+60bp), Insurance (+ 50bp), and Health Care (+ 40bp).
“If the COVID limits are long-term (over 45 days) we could see a shift in the targeted allocation to foreign-focused sectors such as IT and Pharma,” Atish Matlawala, Sr Analyst, told SSJ Finance & Securities.
“Consumer opinion will also hit a high note as low-income earners are becoming more confident because of COVID. However, we expect this to be temporary and when growth returns we expect FIIs to invest heavily in Banks and Metals, ”he added.
FII and DII IDs in the Nifty500
FII capture at the Nifty-500 returned to pre-COVID levels at 4QFY21 – rejecting the 20bp QoQ side, but raising 160bp YoY to 22.3%, data released by Motilal Oswal showed.
Of the Nifty-500, FIIs have the highest ownership in private banks (47.9%), followed by NBFCs (32.9%), O&G (23.1%), Insurance (22.2%), and Real Estate (21.5%). %). DIIs have the highest ownership in Capital Goods (21.9%), Private Banks (20.4%), Metals (18.3%), Consumer Purchases (17.8%), and PSU banks (17.6%).
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Consequently, FIIs have risen to the stake in Telecom (+ 130bp), Metals (+100bp), Consumer Durables (+100bp), Real Estate (+80bp), Cement (+ 60bp), Chemicals (+60bp), Insurance (+ 50bp), and Health Care (+ 40bp).
In contrast, FIIs reduced NBFCs (-40bp), Auto (-30bp), Consumer (-20bp), and Technology (-10bp).
DII capture at Nifty-500 dropped by 10bp QoQ / 50bp YoY to 14.2% in the low seven-quarter range, data showed. The proportion of FII-DII in the Nifty-500 remained 1.6x in the 4QFY21 (unchanged in the previous quarter).
Using the Nifty-500 as a measure, the DII is overweight in Metals, PSU Banks, Capital Goods, Consumer, and Utilities and underweight in NBFCs, Private Banks, and Technology .
Overall, the top 5 DII domains in the Nifty-500 account for 66% of total allocation – BFSI (27.8%), Technology (11.5%), Consumer (10.7%), O & G (9.8%), and Auto (6.2%).
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