Mumbai: Retail investors and insurance companies have increased their stakes in the 30 companies that make up the Sensex, India’s bellwether equity index, between January and March, ignoring a market plunge that saw company promoters and foreign institutional investors, or FIIs, reducing their shareholdings, according to a report by investment bank Deutsche Bank AG. FII ownership in the 30-sto-ck Sensex went down to 18% in March from 18.5% in end-December 2007.
Controlling shareholders, or promoters, reduced their equity holding to 51.1% from 51.4% in the same period, the bank said in its latest equity trend analysis report.
On the other hand, retail investors or individuals increased their ownership of Sensex stocks to 8.7% from 8.5%.
Insurance companies increased their ownership of Sensex shares to 5.9% from 5.5% during the period.
The Sensex lost around 31% between 10 January, when it reached its lifetime high of 21,106.77 points, and mid-March, when it slid to the 14,000 levels.
On 13 June, the index closed at 15,189.62 points, down 60-odd points or 0.4%.
The index had returned at least 45% to investors in 2007 and 2006.
Promoters reduced their equity ownership the most in consumer durables stocks, while FIIs, retail investors and domestic mutual funds bought the most in this sector, said the Deutsche Bank report, based on data from the Centre for Monitoring Indian Economy.
Domestic insurance companies bought stocks in auto, metals and oil and gas sectors the most.
Bank of India Ltd, IFCI Ltd and Cairn India Ltd saw the highest rise in ownership by insurance firms.
Meanwhile, insurance companies sold most in power, capital goods and real estate sectors.
Retail investors also increased their ownership of oil and gas as well as capital goods sector stocks, while they sold the most in health care and real estate.
FIIs bought stakes in health care and technology companies, apart from consumer durables firms, while they sold stocks of power, capital goods and banks, the most.
Jindal Saw Ltd, Karnataka Bank Ltd and Ranbaxy Laboratories Ltd saw the highest increase in FII ownership, between 4% and 4.7%.
Yes Bank Ltd and Sesa Goa Ltd also saw FIIs increasing their holdings in these companies by 3.4% and 3.1%, respectively.
FIIs were the largest sellers in Balrampur Chini Ltd, Cairn India Ltd and Nagarjuna Constructions Ltd.
Foreign institutional investors had invested more than $17 billion in Indian equities in 2007.
This year, they have sold $5.4 billion worth of Indian stocks so far.
Domestic mutual funds accumulated oil and gas stocks and capital goods the most. These funds sold heavily in banks, power and health care, according to the report.
FIIs and controlling shareholders also reduced their stake in the Bombay Stock Exchange BSE 200 index of top 200 companies.
While FIIs decreased their ownership in these stocks to 16.1% from 16.4%, controlling shareholders reduced their holding to 54.5% from 55.1%.
Retail investors, on the other hand, increased their shareholding in BSE 200 to 8.7% from 8.5%.