Foreign institutional investors (FIIs) have reduced their exposure in 20 Sensex companies including, Tata Steel and ITC, during April-June quarter as they recast their portfolio on account of global cues and taxation issues. Of the 30 Sensex companies, FIIs trimmed stake in 20 stocks while they raised their ownership in remaining 10 firms, an analysis of data available with BSE showed.
A slew of global and domestic factors including concerns about slow revival in corporate earnings, taxation issues, uncertainty over Greece's debt crisis and better returns from Asian peers have prompted FIIs to reduce their holdings, market experts noted. Moreover, foreign investors poured a mere Rs 547 crore in Indian capital markets during April-June quarter, after pumping in a whooping Rs 79,000 crore in the preceding three months.
"In the short-term, there is no trigger for foreign investors to pump in money in the domestic capital markets but in medium to long-term, India is an attractive place for investment," UTI Mutual Fund EVP and Fund Manager V Srivastava said.
Among the blue-chip companies, FIIs cut their stake in Tata Motors by the most in June quarter, by 5.81 percentage points to 20.49 per cent. Also, FIIs reduced their shareholding in ITC by 5.25 percentage points to 15.47 per cent, while the same fell in Mahindra & Mahindra by 4.65 percentage points to 32.99 per cent. Besides, overseas investors shed their holding in Hindalco Industries, Hero MotoCorp, Bajaj Auto and Tata Steel among others. While FIIs holding increased in Infosys, Lupin and Cipla among others.
