Foreign promoters’ ownership in the BSE 500 universe climbed to an 11-quarter high in the June quarter, with experts saying they are looking for ‘strategic value’ in Indian markets.
Among the MNCs that have made open offers in recent days, Moody's Singapore Pte acquired 21.55% stake in Icra for Rs 517 crore. The open offer concluded on June 16. UK’s liquor player Diageo made an open offer of Rs 11,449 crore for an additional 26% stake in United Spirits. The open offer closed on June 19. Pharma major Glaxosmithkline Pharmaceuticals saw a Rs 6,398-crore open offer by its foreign parent Glaxosmithkline, which closed on March 5. As per data from Prime Database, foreign entities made 16 open offers worth Rs 44,528 crore in FY14.
Foreign promoters’ holding, as a percentage of total equity in BSE 500, currently stands at 5.4%, show Capitaline data.
Experts say foreign promoters have been raising their stake to take advantage of the lower valuations prevailing three months back. “These foreign promoters have raised their stake on a five-year view. They are investing their surplus funds in Indian companies as they expect the economy to turn around,” said Pankaj Jaju, executive director, investment banking division, Axis Capital.
Among individual scrips, foreign promoters have raised their stake by 12.58 ppt in Siti Cable; from 17.41% in March quarter to 29.99% in June quarter. They have raised their stake in Sesa Sterlite and Cairn India by 2.1 ppt and 0.69 ppt, respectively. Experts expect MNCs to launch more open offers in the coming days.
“In the next six months, we could see some more open offers by foreign parents seeking strategic value,” said Pranjal Srivastava, head, capital markets, ICICI Securities.
YTD, CNX MNC has gained 25.56% against 22.32% gains for the BSE Sensex.