Market Walk

FPIs withdrew Rs.1.65 trillion from Indian equities

FPIs withdrew Rs.1.65 trillion from Indian equities

FPIs withdrew Rs.6,400 crore from Indian equity markets in just 4 trading sessions

Foreign portfolio investors (FPIs) withdrew Rs.6,400 crore from Indian equity markets in just 4 trading sessions after the RBI hiked rates by 40 bps. Other headwinds, like crude prices, OPM pressures and US Fed hawkishness also played a part. April was the seventh consecutive month the FPIs were net sellers and May has started off on a negative note. Between Oct-21 and Apr-22, FPIs withdrew Rs.1.65 trillion from Indian equities. In Asia; even Taiwan, South Korea and the Philippines witnessed heavy FPI outflows.

Global investors in the Nifty 500 companies fell to a multi-year low of 19.5%

The ownership of global investors in the Nifty 500 companies fell to a multi-year low of 19.5%. It was last seen at 19.3% in early 2019. Last year, the global investor ownership of Indian equities had stood at 21.2% so there is a clear indication of FPIs going light on India. While global investors were cutting their stake in India, domestic funds raised their stakes in Indian stocks, especially in IT and hydrocarbons. The selling by global investors has been largely offset by the aggressive buying by domestic funds and retail investors.

DIPAM to invite financial bids for Shipping Corporation of India by Sep-22

Plans are afoot at DIPAM to invite financial bids for the Shipping Corporation of India by Sep-22. However, this will be only after the non-core assets are demerged. These non-core assets that will be hived off include Shipping House in South Mumbai and the Maritime Training Institute in Powai, Mumbai. The non-core assets of SCI have valued at Rs.2,392 crore as per Mar-22 balance sheet. The government owns 63.75% in SCI and wants to hive off its entire stake. This will help boost India’s divestment revenues in FY23.

Russia Ukraine war has come as a blessing in disguise for Reliance Industries

The Russia Ukraine war has come as a blessing in disguise for Reliance Industries. RIL deferred the annual maintenance work at the refining complex to churn out more diesel and naphtha amidst surging prices. RIL is buying cargoes of oil at discounted rates from Russia ahead of EU sanctions expected. RIL has already minimized feedstock cost by sourcing arbitrage barrels. In a sense, cheap oil from Russia has helped India keep inflation in check. Indian refiners have bought more than 40 million barrels of Ural crude from Russia.

Future Enterprises Ltd looks to raise up to Rs.3,000 crore by selling its stake in its insurance business

Future Enterprises Ltd looks to raise up to Rs.3,000 crore by selling its stake in its insurance business to cut debt. This could still save the company from the insolvency process, but looks a far cry. Last week, FEL closed the sale of 25% stake in Future Generali to joint venture partner, Generali SPA, for Rs.1,266 crore. Post the sale, FEL still holds 24.91% stake in Future Generali JV. If the balance stake is also sold and if its 33.3% stake in Future Generali Life is also sold, it can raise Rs.3,000 crore. It may still be too little, too late.

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