Top 5 Stocks Where FII Holding is Higher than Promoter Holding

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  • Dec 21, 2021 - Top 5 Stocks Where FII Holding is Higher than Promoter Holding

Top 5 Stocks Where FII Holding is Higher than Promoter Holding

Dec 21, 2021

Top 5 Stocks Where FII Holding is Higher than Promoter Holding

While keeping track of a stock, knowing who has the highest or lowest exposure holds much significance as it provides insights into the company.

For instance, promoters know their company inside out. So, if there's any change in their shareholding, it indicates their interest in the company.

While an increase in promoter holding sends out a positive signal, a decrease sends a negative message, raising concerns.

Another important class of investors is foreign institutional investors (FIIs). Over the years, FII's interest in Indian stocks have increased. There are certain instances (HDFC, ZEE, Shriram Transport) where a majority of stake is owned by them.

FIIs take exposure after looking at the company's fundamentals and meeting the management.

Tracking the shareholding patterns of FIIs goes a long way in making your investment decisions.

In this article, we look at the top stocks in which FII holding is higher than promoter holding.

#1 Aavas Financiers

In the September 2021 quarter, FII holding in Aavas Financiers surpassed its promoter holding.

As of September 2021, promoter holding in the housing finance company stood at 39.22%. Prior to this, in the June 2021 quarters, promoters held over 50% stake.

In August 2021, two promoters of Aavas Financiers offloaded shares worth Rs 7.5 bn through open market transactions.

While promoters of the company have been offloading stake, FIIs are loading up.

FII holding as of September 2021 stands at 39.81%. The latest September 2021 shareholding data shows that FIIs increased their stake in the company by 7.68%.

And it's not just FIIs. Even mutual funds are bullish on the stock. Mutual funds too, increased their stake to 4.45% in the quarter under review.

Shares of the company have seen a good run in the past year, rising around 50%. They have been under pressure in the month of December as volatility has picked up.

As demand picks up in the real estate sector, housing finance companies like Aavas Financiers will be able to report higher earnings.

To know more, check out Aavas Financiers' latest shareholding pattern.

#2 Teamlease Services

As of September 2021, FII holding in Teamlease Services stands at 37.65%. This is higher than promoter holding of 32.51%.

Promoter holding in the quarter decreased 1.5%. Promoters increased their pledged shares by 0.06%.

Even mutual funds hold a significant stake of 11.12% in the company.

Teamlease Services is one of India's leading human resource (HR) companies offering a range of solutions to 3,500+ employers for their hiring, productivity, and scale challenges.

Recently, the company announced selling its subsidiary IIJT Education.

Shares of the company are on a roll this year, particularly in the October-December quarter as hiring intent has touched its zenith mark during the period at 41%.

Over the year gone by, Teamlease Services share price has gained around 60%.

chart

#3 UPL

Even though FIIs reduced stake in agrochemical company UPL by 2.7% in the September 2021 quarter, they still hold 35.12% stake.

Promoter stake on the other hand stands at 27.96%.

Shares of the company were in focus last month when its promoters increased their stake. Uniphos Enterprises acquired 1.37 lakh shares in the company through open market transactions, increasing its shareholding to 5.17% from 5.15%.

Established in 1969, UPL is the largest producer of agrochemicals in India. It's the eighth largest overall and second largest post-patent agrochemical player in the world in terms of revenues.

Its portfolio consists of total crop solution products to enhance farm productivity and profitability. It provides a full range of crop solutions from seeds and seeds treatment to post harvest products. Its product range includes Seeds, Herbicide, Insecticide, Fungicide, Fumigants and Post-harvest Specialty.

In the last year, shares of UPL are up around 67% compared to 24% gains of the BSE Sensex.

To know more about the company, check out UPL's 2020-21 annual report analysis.

#4 PTC India

PTC India is mainly engaged in trading of power and holds a dominant market share.

As of September 2021, foreign investors hold 34.68% stake in the company while promoter holding stands at 16.2%.

Interestingly, FIIs have continuously increased stake in the electric utility company for the past four quarters. In December 2020, FIIs held 28.7% stake in PTC India. Now they hold 34.7%.

While FIIs are bullish on the stock, mutual funds are continuously selling their stake for the past two years. From holding over 9% stake in March 2020, mutual funds currently hold a mere 0.84% stake in PTC India.

Just last month, it was announced that state-owned power producer SJVN has signed a pact with PTC India to develop products for supplying renewable energy.

For the September 2021 quarter, PTC India posted a marginal rise in its net profit at Rs 1.95 bn.

To know the detailed results, check out PTC India's latest quarterly results.

#5 Zee Entertainment

Zee Entertainment Enterprises (ZEE) has been a FII favourite stock for quite some years. The company, founded by Essel Group's Subhash Chandra, is majority-owned by foreign institutional investors.

Don't let this come as a surprise but FIIs have 57.2% stake in Zee Entertainment as of September 2021.

Prior to this, FIIs had more exposure to the extent of around 68% but they pared stake in the two most recent quarters.

Investors in ZEE include OFI Global Fund China, Vanguard International, Invesco Oppenheimer, and Amansa Holdings among others.

Promoters of ZEE, the Essel group, holds just 4% stake as of September 2021.

The stock of Zee Entertainment was the most buzzing stock a couple of month ago when there was news of a takeover.

The company's largest shareholder Invesco demanded a board overhaul and removal of founder Subhash Chandra's son Punit Goenka as a director which sent its stock soaring 40% in September 2021.

Even the big bull Rakesh Jhunjhunwala piled up ZEE shares back then, picking up nearly 5 m shares for Rs 1.1 bn in a block deal.

The media company is locked in a legal battle with one of its biggest foreign investors, Invesco, after it called for ouster of CEO citing concerns around corporate governance. This battle has come at a time when ZEE is undergoing merger with the local unit of Japan's Sony Group Corp.

The company is now in the final stages of completing the due diligence for its proposed merger as the 22 December deadline is upon us.

Starting September, there were sharp spikes in the company's share price. After the merger was announced, the stock went on to rally some more.

Over the year gone by, Zee Entertainment share price is up 60%.

chart

To know more, check out Zee Entertainment's latest shareholding pattern.

In which other companies is FII holding higher than promoter holding?

Apart from the above, here are a few companies where FII holding is more than promoter holding.

Company FII Holding (%) Promoter Holding (%)
Axis Bank 51.38 11.64
Shriram Transport 53.67 25.58
Apollo Hospitals 51.54 29.82
IndusInd Bank 51.44 16.54
Kotak Mahindra Bank 42.58 26
M&M 38.92 19.46
PVR 37.83 17.04
HDFC Bank 38.23 25.83
AU Small Finance Bank 32.45 28.39
Source: Equitymaster
Data as on September 2021

Since you're interested in tracking FII and promoters' shareholding activity, check out Equitymaster's Powerful Stock Screener.

This tool keeps track of what foreign investors are buying and selling. It also tracks the companies in which promoters are increasing stake.

Here are Links to Some Very Insightful Equitymaster Articles on FIIs and Promoters:

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...

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