The share of retail investors in the companies listed on the National Stock Exchange grew to an all-time high of 7.62 percent in the September quarter, according to PRIME Database Group.
Retail investors, individuals with up to Rs 2 lakh shareholding in a company, bought a net of Rs 7,596 crore in the July-September period. The share of the government as promoter increased as well, to a five-year high of 8.79 percent.
“However, over a 14-year period, the share of the government has declined considerably, from 22.48 percent as on June 30, 2009, primarily due to the government’s divestment programme, not enough new listings as also lacklustre performance of many CPSEs relative to their private peers,” said Pranav Haldea, Managing Director, PRIME Database Group.
On the other hand, the share of private promoters declined to a four-year low of 41.55 percent. Over the last one year alone, it has fallen by 306 basis points from 44.61 percent on September 30, 2022.
One basis point is one0hundredth of a percentage point.
According to Haldea, stake sales by promoters to take advantage of bullish markets, relatively lower promoter holding in companies getting listed and also overall institutionalisation of the market have led to the decline.
The gap is narrowing
Domestic institutional investors' (DIIs) holdings crossed Rs 50 lakh crore and is on track to overtake those of foreign institutional investors (FIIs) over the next few quarters.
The gap between FII and DII holdings narrowed to an all-time low this quarter, with domestic investors holdings just 13.11 percent lower than those of their foreign counterparts.
The widest gap was on March 31, 2015, when DII holding was 49.82 percent lower than FII. The FII- DII ownership ratio also decreased to an all-time low of 1.15 percent on September 30, 2023 from an all-time high of 1.99 in the quarter ending March 31, 2015.
The share of DIIs as a whole decreased marginally to 15.99 percent from 16.05 percent in the June quarter. However, in the Nifty-500 and Nifty-200 universe, the DII share went up from 16.57 to 16.70 percent from 17.12 to 17.51 percent, respectively.
While net inflows of domestic mutual funds stood at Rs 53,715 crore during the quarter, insurance companies sold a net of Rs 23,996 crore and banks sold a net of Rs 10,424 crore. Net inflows from DIIs on an overall basis stood at Rs 42,632 crore during the quarter.
Where did they invest?
While FIIs pumped in Rs 19,375 crore, Rs 7,882 crore and Rs 7,549 in capital goods, financial services and IT sectors, respectively, they pulled out Rs 11,493 crore, Rs 4,932 and Rs 3,120 crore from metals & mining, services and oil & gas names, respectively.
The share of domestic mutual funds rose to 8.73 percent from 8.63 percent. MFs increased their exposure to healthcare and consumer discretionary sectors, while lowering their holdings in industrials and financial services.
The share of insurance companies declined to 5.48 percent from 5.66 percent in the June quarter, according to data.
Insurance companies increased their exposure to information technology and services sectors, while paring stakes in FMCG and telecommunication.
There were 12 companies in which the trinity of promoters, FIIs and DIIs all increased their stake during the quarter. These were Wipro, Aegis Logistics, Bombay Burmah Trading Corp., Maharashtra Seamless, Mrs Bectors Food Specialities, Man Infraconstruction, Greenpanel Industries, Rallis India, Choice International, Thirumalai Chemicals, Foods & Inns and Snowman Logistics.
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