FIIs & DIIs are Buying These 5 Indian Stocks. Take a Look...

The pace of FII selling has eased, particularly in the wake of a decline in US bond yields, instilling hope that the Federal Reserve has concluded its rate hike cycle and contributing to a positive shift in sentiment across the equity market.

On 16 November 2023, FIIs broke their selling streak by engaging in substantial purchases totalling Rs 135.5 billion (bn) during the festive season, coinciding with the stock market marking higher closures for two consecutive days.

Despite this recent buying spree, FIIs still recorded a net sale of Rs 2.2 bn worth of shares in the past week. However, this was entirely offset by domestic institutional investors, who, driven by a two-day surge in buying interest, procured shares amounting to Rs 15.8 bn during the same period.

Furthermore, in the current month, domestic institutional investors displayed robust purchasing activity by acquiring shares worth Rs 77 bn in the cash segment, effectively neutralising the Rs 65.8 bn worth of shares sold by FIIs.

Despite the overarching trend of net selling by FIIs, a select group of companies has managed to attract significant FII inflows as well as buying from DIIs during the second quarter.

Here are five of them.

#1 Prudent Corporate Advisory

Leading the list is Prudent Corporate Advisory.

The company is a leading financial services provider in India, offering a wide range of services, including investment banking, wealth management, and corporate advisory.

The latest shareholding pattern for Prudent Corporate Advisory reveals a notable increase in FII stake, rising from 1.4% in the June 2023 quarter to 3.8% in September 2023, a growth of 2.4%.

Simultaneously, DIIs have augmented their stake from 9.2% in the June 2023 quarter to 15.7% in the September 2023 quarter, reflecting a substantial increase of 6.4%.

This positive shift can be attributed to the company's impressive track record in successfully executing M&A transactions coupled with the rapid expansion of its wealth management business.

This makes Prudent Corporate Advisory among the top 10 investment banking firms in India.

On the financial front, the company's revenue from operations grew 29% to Rs 1.9 bn as the average assets under management were up 29%. The net profit for the quarter grew by 10% at Rs 300 million (m), led by strong operational growth.

Looking ahead, Prudent Corporate Advisory has set ambitious goals for the next three years, aiming to achieve an Assets Under Management (AUM) milestone of Rs 1 trillion (tn).

Furthermore, the organisation anticipates that its Systematic Investment Plan (SIP) inflow will surpass the Rs 10 bn mark during this period.

To know more, check out Prudent Corporate Advisory company fact sheet and quarterly results.

#2 Elecon Engineering

Second on the list is Elecon Engineering.

Elecon Engineering is one of the largest manufacturers of material handling equipment and industrial gear in Asia.

The company has a global presence in the US, UK, and European countries.

In the September 2023 quarter, FIIs increased their holdings in the company, elevating their stake from 2.8% in the preceding June 2023 quarter to 4.9%, marking a notable increase of 2.1%.

Concurrently, DII stake witnessed a growth of 0.9%, reaching 2.9%.

This surge in holdings is attributed to a significant order win amounting to Rs 514.1 million from ArcelorMittal Nippon Steel India Limited (AMNS).

The contract involves the supply and supervision of a Pipe Conveyor System slated for deployment at AMNS's Hazira Plant in Gujarat, India, with an estimated project execution timeframe of approximately 12 months.

Coming to its financial performance, the company's revenue experienced a robust growth of 24.8%, reaching Rs 4.5 bn compared to Rs 3.9 bn in the same period the previous year.

Concurrently, the net profit exhibited a substantial increase of 37.4%, with the September quarter net profit standing at Rs 886 m as opposed to Rs 645 m in the corresponding period last year.

The company is optimistic about the new products in the pipeline and demand from European OEMs.

To know more, check out Elecon Engineering company fact sheet and quarterly results.

#3 Kaynes Technology

Third on the list is Kaynes Technology.

Kaynes Technology is leading end-to-end and IoT solutions-enabled integrated electronics manufacturer in India.

The latest shareholding pattern for Kaynes Technology reveals that FII have increased their stake from 7.9% in the June 2023 quarter to 9.9% in September 2023, up 1.9%.

Similarly, DIIs increased their stake from 17.9% to 19.1%, reflecting a growth of 2.5%.

The company has ambitious plans to invest Rs 28 bn in acquiring a 40-acre plot in the Ranga Reddy district of Telangana. The investment is aimed at establishing a semiconductor OSAT (outsourced semiconductor assembly and test) manufacturing and compound semiconductor facility.

In the September 2023 quarter, Kaynes Technology reported a substantial YoY revenue growth of 32%, amounting to Rs 3.6 bn, while the net profit increased by 12% to Rs 320 m from Rs 290 million in the corresponding period of the previous year.

Looking ahead, the company plans to enhance the aerospace segment's contribution to its overall revenue, targeting a significant 10% share by the first half of FY25.

To know more, check out Kaynes Technology company fact sheet and quarterly results.

#4 Jindal Saw

Fourth on the list is Jindal Saw.

The flagship company of PR Jindal group, Jindal Saw is a leading global manufacturer and supplier of Iron and steel pipes and pellets.

For the September 2023 quarter, FIIs have increased their stake in the company to 17.7%, up 1.8% from 15.9% in the preceding June 2023 quarter. Concurrently, DII stake witnessed a growth of 1.2%, reaching 1.7% in the September 2023 quarter.

This positive shift is attributed to the company consistently reporting exceptional financial performance, driven by increased sales volume, improved capacity utilisations, and higher realisations.

In the September 2023 quarter, the company reported a substantial 35% YoY rise in revenue, amounting to Rs 54.6 bn. The net profit witnessed a remarkable surge of over 1,595%, soaring from Rs 0.2 bn to Rs 3.5 bn compared to the same period the previous year, reflecting increased demand.

Looking ahead, the company has plans to expand its capacity over the next three years.

However, its shares have experienced a notable surge, providing multibagger returns in 2023.

To know more, check out Jindal Saw company fact sheet and quarterly results.

#5 RBL Bank

Last on the list is RBL Bank.

The bank offers services under five business verticals, namely corporate & institutional banking, commercial banking, branch & business banking, retail assets, and treasury and financial markets operations.

During the September 2023 quarter, FIIs significantly increased their stake in the company, elevating ownership from 28.3% in June 2023 to 30%. Simultaneously, DIIs increased their stake from 17.9% to 19.1%, reflecting a growth of 1.2%.

This positive shift can be attributed to favourable conditions expected in the upcoming quarters, including a gradual improvement in asset quality, reduced credit costs, and increased deposits, contributing to improved profit margins.

The sustained momentum in the retail and SME segments is anticipated to drive further momentum in the stock.

RBL Bank has recently launched the GO Savings Account, its latest digital banking product, catering to customers of all age groups with a zero-balance account, a simple account opening process, and easy-to-operate features, fostering a positive outlook for the bank's growth.

In the September quarter, the company reported a robust 29.6% growth in revenue, amounting to Rs 37.3 bn. The net profit exhibited a significant 46% YoY rise, reaching Rs 2.9 bn.

Going forward, the company plans to add more bank branches.

To know more, check out RBL Bank company fact sheet and quarterly results.

Conclusion

Investing in stocks that FIIs and DIIs are buying and selling can be an interesting strategy, as they have access to extensive research and resources, and their investment decisions can reflect a level of confidence in the company's prospects.

However, these investors often have specific objectives or constraints that may not align with individual investors' needs. Their investment horizon, risk tolerance, and goals may differ from yours, so blindly following their investments may not be suitable for your portfolio.

Further, by the time FIIs and DIIs investments are publicly disclosed, the stock price may have already moved, potentially reducing the upside potential and increasing the risk.

Their investment activity can provide valuable insights it should be just one part of your investment decision-making process. Conduct your research, align your investments with your financial goals and risk tolerance, and consider the broader market context.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...