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MOSL: INDIA STRATEGY - Ownership analysis – Institutional stake moderates in 1QFY22; FIIs/DIIs raise stakes in Consumer Durables

India Strategy: Ownership analysis – Institutional stake moderates in 1QFY22; FIIs/DIIs raise stakes in Consumer Durables

 

• Equity markets have seen strong rally in CY21 and Nifty-50 and NSE Midcap-100 are up 13%/32% YTD'21.
• Within the NSE-500, we see divergent sequential trends between FII and DII purchases. DIIs raised weights in Automobiles, Insurance, NBFCs, Oil & Gas, and Real Estate, while FIIs reduced weights QoQ. On the other hand, FIIs increased weights in Capital Goods, Chemicals, and Consumer, whereas DIIs trimmed weights QoQ.
• FIIs and DIIS posted inflows of USD0.8b and USD2.7b in 1QFY22, respectively.
• In this report, we dive deep into the ownership of the various sectors/companies in the Nifty-500 to see how this changed in 1QFY22.

 

FII ownership in Nifty-500 down 60bp QoQ

• FII holding in the Nifty-500 is down 60bp QoQ/+90bp YoY to 21.7% in 1QFY22. DII holding in the Nifty-500 was down10bp QoQ / 70bp YoY to 14.1%.
• FIIs increased ownership in 52%/54% of Nifty-500/Nifty-50 companies QoQ, while DIIs increased stake in 45%/50% of Nifty-500/Nifty-50 companies QoQ.
• A mixed trend was observed in promoter holdings – an increase of 50bp QoQ (down 50bp YoY to 49.9%). Promoter stake in Coforge, Indian Bank, Union Bank, Crompton Greaves Consumer, TVS Motor, and HDFC Life Insurance declined on account of stake sales and capital raising exercises. Conversely, United Breweries, Vedanta, and Tata Motors posted an increase in promoter stake QoQ.
• As a proportion of the free-float of the Nifty-500, FII ownership decreased 70bp QoQ to 43.4%, while DII remained unchanged at 28.1%. Notably, FII ownership rose 150bp YoY, whereas DII ownership declined 180bp YoY.
• The FII-DII ownership ratio in the Nifty-500 declined marginally to 1.5x in 1QFY22 (from 1.6x in the previous quarter).