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MOSL: Morning India (28/May/20): 1. India Strategy (Ownership analysis: FII stake in Nifty-500 hits 5-year low); 2. Sun Pharma; 3. Dabur; 4. United Spirits; 5. Coromandel Intl.; 6. Aditya Birla Fashion; 7. Ques

MOrning India (28/May/20): 1. India Strategy (Ownership analysis: FII stake in Nifty-500 hits 5-year low); 2. Sun Pharma; 3. Dabur; 4. United Spirits; 5. Coromandel Intl.; 6. Aditya Birla Fashion; 7. Quess Corp.; 8. SH Kelkar

 

Today’s top research theme

India Strategy: Ownership analysis – FII stake in Nifty-500 hits 5-year low

• FII holdings in the Nifty-500 hit a 5-year low, declining 140bp QoQ/80bp YoY to 21% in 4QFY20. FIIs have reduced ownership in 67% of Nifty-500 and 90% of Nifty-50 companies QoQ.
• On the other hand, DII holdings in the Nifty-500 were up 20bp QoQ/90bp YoY to 14.8% in 4QFY20. DIIs increased stake in 61% of Nifty-500 and 78% of Nifty-50 companies QoQ.
• Further, promoters took advantage of the sharp correction post the COVID-19 pandemic and raised ownership. Thus, promoter holdings in the Nifty-500 companies increased 130bp QoQ/150bp YoY to 50.5% in 4QFY20.
• FII ownership as a proportion of free float of the Nifty-500 declined 180bp to 42.3%. DII ownership as a proportion of free float increased 90bp QoQ/260bp YoY to 29.8%.
• Sequentially, on a QoQ basis, FIIs have increased stake in Telecom (+190bp), NBFCs (+110bp), Insurance (+50bp), Retail (+30bp), Utilities (+20bp) and Oil and Gas (+10bp). In contrast, Metals (-200bp), Autos (-150bp), Capital Goods (-140bp), Private Banks (-120bp), Healthcare (-110bp) and Cement (-110bp) have seen reduction in FII stake.
• On a QoQ basis, DIIs increased stake in Telecom (+220bp), Utilities (+190bp), Metals (+110bp), NBFCs (+100bp) and Private Banks (80bp). Consumer was the only sector where DIIs reduced stake by 110bp.