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Business Standard
13-05-2025
- Business
- Business Standard
India Inc. promoter holdings continue to fall, but experts see no red flags
Promoter ownership in domestic companies has declined to the lowest level since the September quarter of 2017, but market experts say the trend is largely market-driven and does not point to any governance-related concerns. In the NSE 500 universe, private promoters' share of overall holdings has dropped to 39.6 per cent in the March quarter so far, the lowest level since the September quarter of 2017, according to data from In December 2024, private promoter holdings in the broader universe stood at 39.76 per cent, declining slightly to 39.6 per cent in the quarter under review. Among the non-PSU Nifty 50 companies, promoter holdings currently stand at 34.4 per cent, the lowest since June 2017, as per the latest data. There are no governance concerns here as the regulations are strong, said Chokkalingam G, founder of Equinomics Research. He explained that the recent decline in promoter holdings is largely driven by market dynamics, particularly elevated valuations following an unprecedented bull run in calendar year 2024. 'Some stocks became extraordinarily overvalued. For instance, metal stocks that typically traded at 8 to 11 times earnings were suddenly valued at 25 to 35 times. This created an opportunity for promoters to offload shares,' he said. According to Chokkalingam, promoter selling at such high valuations should not be viewed with suspicion but rather as a signal for investors to assess price levels more carefully. 'Promoters understand their businesses better than most investors. If they are selling at a certain level, that price should serve as a reference point in the next market cycle,' he added. The reduction in the holdings comes in a quarter that was marked by a correction in the market triggered by global funds outflows amid valuation and trade war-related concerns. During the March quarter, the benchmark Nifty50 and the 30-stock Sensex saw a decline of 0.5 per cent and 0.9 per cent, respectively. Meanwhile, the Nifty midcap and small-cap indices fell by 13 per cent in the quarter. A lower promoter holding does not necessarily indicate a negative outlook for a company, said Deven Choksey, Managing Director of DRChoksey FinServ Pvt. Ltd. The very purpose of a company getting listed on the exchanges is to dilute its stake in order to raise funds. As long as companies receive the right valuation for the stake they offload, it should not be a concern. Shift in tide: DIIs versus FIIs This shift comes when, for the first time that domestic institutional investors (DIIs) now own a larger share of India's top 500 listed companies than foreign institutional investors (FIIs), marking a structural realignment in India's capital markets. As of March 2025, DIIs held an 18.4 per cent stake in Nifty 500 companies, surpassing foreign institutional investors (FIIs), whose ownership declined to 18.16 per cent. The FII-DII ownership ratio, which once stood at approximately 1.5 times in September 2021, fell to 0.99 times in the March quarter, highlighting the rising influence of domestic capital in Indian equities.
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Business Standard
07-05-2025
- Business
- Business Standard
Operation Sindoor: Prolonged strikes can sink markets, say analysts
A prolonged war / tension with Pakistan post Operation Sindoor – the retaliatory attack by Indian armed forces on Pakistan and Pakistan Occupied Kashmir (PoK) – could 'sink' markets, suggest analysts. However, they could see a recovery in due course if the measures are limited only to select targets and the tensions de-escalate, they said. History, Aniruddha Sarkar, chief investment officer at Quest Investment Advisors said, suggests that Indian markets have most of the times done well during and even after any conflict with Pakistan on the borders. This time is no different. 'Though the geopolitical concerns have been there for the last two weeks, yet foreign institutional investor (FII) inflows continued into our markets, which is a stamp of our economic resilience to these short-term border conflicts. Any military campaign which would be limited to selected targets and be over within a few days or weeks, would not have any negative impact on our economy or markets. Prolonged conflict, which seems unlikely at this moment, could impact investor sentiment negatively as they would prefer a risk off mode,' Sarkar said. In the intervening night of May 6 and May 7, Indian armed forces carried out strikes on terrorist infrastructure in Pakistan and Pakistan-occupied Jammu and Kashmir (PoJK) in response to the terrorist attack in Pahalgam on April 22 that left 26 civilians dead. Historically, Indian equity markets have typically reacted sharply to geopolitical tensions in the short-term as a knee-jerk, but recovered quickly once uncertainties subsided. For example, during the Kargil conflict between India and Pakistan in mid-1999, markets experienced a significant correction. However, they rebounded strongly as it became evident that the conflict would be short-lived. Ambareesh Baliga, an independent market analyst, too, feels that if Operation Sindoor remains localised within a band / territory with targeted strikes and ends soon, the markets could witness a smart recovery. 'In case the current conflict widens, the uncertainty will sink the market. As of now it would be a wait-and-watch strategy. Post Balakot also, we witnessed a smart move up in the markets,' he said. The information available till now on Operation Sindoor has been digested by the markets, feels U R Bhat, co-founder & director, Alphaniti Fintech. For the markets to stabilize, he feels, more information is needed on how Pakistan is likely to react to the developments. "The markets are waiting with bated breath and are likely to remain volatile. While the available information has been digested by the markets, any escalation in the tensions will see them spiral down. As a strategy, investors should sell the rallies till there is truce and more clarity on the developments," he said. Within the market segments, G Chokkalingam, founder and head of research at Equinomics Research, said small-and mid-cap segments may underperform the large-caps as retail investors' participation seems to be weak due to geopolitical developments. "Till intense tensions on border moderates, we suggest some tilt towards large-caps, especially the Sensex and Nifty stocks. Of course, if there is any escalation or war with Pakistan, then the whole market, including large-caps may see a substantial fall," he warns.
Time of India
29-04-2025
- Business
- Time of India
Foreign investors back with $4.11 billion in Indian equities! FPIs extend longest buying spree since July 2023
FPIs invested approximately $4.11 billion in Indian stocks across nine consecutive sessions. (AI image) Foreign investors maintained their longest purchasing streak since July 2023 on Monday, driven by optimistic prospects regarding US trade agreements, attractive company valuations, and India's stability amidst global uncertainties. This trend persisted despite tensions between India and Pakistan. Foreign portfolio investors (FPIs) invested approximately $4.11 billion in Indian stocks across nine consecutive sessions, resulting in a 6.6% increase in the benchmark Nifty 50 index during this period. G Chokkalingam, founder and head of research at Equinomics Research told Reuters that international investors are returning to Indian stock markets because India appears less susceptible to global trade conflicts compared to the US and China. He also noted that India is expected to maintain its position as the fastest-growing major economy in fiscal year 2026. FPIs in Indian stock markets The stock markets remained resilient, dismissing concerns about potential escalation of India-Pakistan tensions following the terrorist attack in Kashmir last week, which had initially affected investor confidence. Market analysts indicate that anticipated U.S.-India trade agreements could lead to increased portfolio investments in the immediate future. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like The Best-Paying Degrees of 2025 Are Not What You Think Best Paying Degrees | Search Ads Learn More Undo On Monday, U.S. Treasury Secretary Scott Bessent noted that whilst numerous trading partners presented "very good" tariff proposals, an agreement with India would likely be amongst the first to be finalised, possibly within the week. Foreign investors' attention towards Indian equities is attributed to favourable large-cap valuations and robust performance from key companies like Reliance Industries, alongside strategic fund movements between China, India, and the United States, according to Kranthi Bathini of Wealthmills Securities. Also Read | Gold prices hit Rs 1 lakh! What's the outlook for gold and should you buy or sell the yellow metal? Explained This recent foreign investment follows a period of significant withdrawals totalling $25.3 billion from October 2024 to March 2025, triggered by elevated valuations, declining earnings, growth concerns and global trade uncertainties. As of Monday's closing, the Nifty index stood 7.4% lower than its peak reached on September 27, 2024. Stay informed with the latest business news, updates on bank holidays and public holidays . Master Value & Valuation with ET! Learn to invest smartly & decode financials. Limited seats at 33% off – Enroll now!
Deccan Herald
29-04-2025
- Business
- Deccan Herald
Longest foreign buying spree in nearly two years powers Indian markets
The main reason for FPIs coming back into Indian markets is that the US and China are more vulnerable to a global trade war than India, which is projected to still remain the fastest growing large economy in fiscal year 2026, said G Chokkalingam, founder and head of research at Equinomics Research.
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First Post
29-04-2025
- Business
- First Post
Indian markets beat terror and tariff tensions as foreign buyers go on 2-year record spree
Foreign investors have pumped over $4 billion into Indian stocks in the past nine sessions, marking their longest buying streak since July 2023. Their interest is fuelled by hopes of a US-India trade deal, attractive stock valuations, and India's steady growth amid global uncertainty. read more Foreign investors continued their longest buying streak since July 2023 on Monday, driven by hopes of a US trade deal, attractive company valuations, and India's stability amid global tensions. Foreign portfolio investors (FPIs) have poured about $4.11 billion into Indian stocks over the last nine sessions, pushing the Nifty 50 index up by 6.6 per cent during this time. The main reason foreign investors are returning to Indian markets is that the US and China are more exposed to a global trade war, while India is expected to stay the fastest-growing major economy in fiscal year 2026, said G Chokkalingam, founder and head of research at Equinomics Research. STORY CONTINUES BELOW THIS AD Markets have also brushed off concerns about rising tensions between India and Pakistan after a deadly militant attack in Kashmir last week, which had briefly hurt investor sentiment. Analysts also said hopes of a US-India trade deal could bring more foreign investment into Indian markets in the near future. US Treasury Secretary Scott Bessent said on Monday that many key trading partners had made 'very good' tariff offers, but a deal with India would likely be one of the first to be signed, possibly as soon as this week. Foreign interest in Indian stocks is also rising due to attractive large-cap valuations and strong earnings from major companies like Reliance Industries, said Kranthi Bathini, director of equity strategy at Wealthmills Securities. The recent foreign buying comes after $25.3 billion in outflows from Indian markets between October 2024 and March 2025, driven by high valuations, slowing earnings, and global trade worries. As of Monday's close, the Nifty was still 7.4 per cent below its record high from September 27, 2024.
