Mumbai: Foreign funds creamed off over Rs 30,000 crore ($4.3 billion) by selling blue-chip stocks like Reliance Industries, ICICI Bank, Axis Bank, TCS, SBI and Sun Pharma during the December quarter.
Foreign Portfolio Investors were aggressive sellers in Nifty and Sensex stocks during the third quarter of this financial year while where they were also seen buying into select mid-cap stocks.
An analysis shows that FPIs have sold 3 per cent holding in Axis Bank to mop up Rs 4,757 crore, while in ICICI Bank they sold 1.9 per cent stake for over `4,092 crore. They offloaded stocks worth Rs 2,969 crore and Rs 2,429 crore, respectively, in Reliance Industries and Sun Pharmaceutical Industries.
FPIs have scaled down their stakes in IT companies like Tata Consultancy Services, Infosys Technologies, Mindtree, Hexaware Technologies, L&T Infotech and Vakrange.
“FIIs have been cautious about the India market in the last one year on account of premium valuation and lack of earnings growth, due to this domestic market underperformed versus its global peers in recent times,” said Vinod Nair, Head of Research at Geojit Financial Services.
FPIs have raised their stake in mid-cap companies during the October-December 2018 quarter.
Some mid-cap companies in which FPIs have raised their stakes include Bharat Financial Inculsion, Just Dial, Divi’s Laboratories, Power Finance Corporation, Dewan Housing and Lupin. They have raised the holdings in Dr Reddy’s Laboratories as well.
FPIs sold stocks of banks, IT services and oil, gas & consumable fuels, while mutual funds bought oil, gas & consumable fuels, banks and IT services during the December 2018 quarter
FPI ownership in the BSE-200 Index was steady at 23.6 per cent in the December quarter.
Overseas investors pulled out over `83,000 crore from the capital markets in 2018, after pouring in a record Rs 2 lakh crore in 2017, on the back of rate hikes in the US, rise in global crude prices and rupee depreciation.
Foreign flows are expected to be range-bound in 2019, as FPIs may continue their cautious stance until there are concrete signs of economic recovery and certainty over the formation of a stable government after the general elections, analysts said.