The first quarter of 2013-14, which ended June 30, has brought with it good news for Gujarat-based companies from foreign shores. Of the top 25 listed entities from Gujarat, 60% have succeeded in attracting foreign institutional investments.
Also noteworthy is how pharmaceutical and FMCG sectors are no longer the dominant force in attracting FIIs; for other sectors, too, have caught up with them in the past few quarters.
The port company of Adani Group, Adani Ports & SEZ, has topped the highest-gainers chart for Q1 2013-14, by witnessing a 4% rise in FII holdings. Adani Enterprise, with its 1.55% rise in FII stake, also finds itself in the top five.
Claris Lifesciences, courtesy its joint venture with the Japanese Otsuka Pharmaceutical Factory, is the only pharma firm in the top-five grosser’s list. This city-based sterile injectable firm attracted 2% more FII to the company’s coffers in the April-June quarter. Sintex Industries and AIA Engineering, with their 1.81% and 1.52% growth in FIIs respectively, round up the top five.
The positive sentiments, meanwhile, have also echoed in the equity market. Foreign investors have pumped in Rs16,556 crore in India in Q1, which is a very healthy sign – believes Madhur Todi, a city-based stock market expert.
“FIIs have once again gained confidence in Indian companies. I expect the market to only move northwards from here,” said Todi. “Going by this trend, Sensex will rise by 7,000 points in the next two years.”
The benchmark indices, however, are yet touch the peak that they scaled in January 2008. “The current value of the index and the companies is very low; hence, FIIs are pumping in money. I suggest retail investors put money in good scrips now, as this is the opportunity to cash in on 50% profit in the coming years,” said Todi.
But several state companies aren’t part of this positive story.
Several have seen a continued reduction of FII holdings in their shareholding pattern.
The state-based power companies are the worst hit here.
Torrent Power and Adani Power feature in the bottom five, with a marked reduction in their FII holdings. Arvind Ltd too has faced the brunt, despite a good order book. The share price of the chemical company, Kiri Industries, has hit the bedrock. FIIs simply are shy from investing in this firm.
Meanwhile, a depreciating rupee, which at the time is just shy of the Rs65-per-dollar mark, has bled dry Gujarat Gas of all of its energy. Despite British Gas’s exit and GSPC taking over the reins, Gujarat Gas has lost 1.62% of its FII stake – right at the bottom of the pile.