LIC's holding in listed companies at all-time low on profit booking in Q4

Topics LIC  | Mutual Funds | Insurance

LIC's holding across 296 companies where its holding is more than 1 per cent slipped to an all-time low of 3.66 per cent as on March 31, 2021, down from 3.70 per cent as on December 31, 2020 and from all-time high of 5 per cent as on June 30, 2012, as per primeinfobase.com, an initiative of PRIME Database Group.

Pranav Haldea, the managing director of Prime Database Group attributed this to profit-booking by India's largest institutional investor, adding that the stake held had touched an all-time high of 5 per cent in 2012.

Interestingly, in value terms there was an increase in the equity assets held by the state-run company at an all-time high of Rs 7.24 lakh crore in March, which represents a 6.30 per cent increase, it said, pointing out that market benchmarks Sensex and Nifty rose by 3.70 and 5.10 per cent, respectively, during this period.

Holdings by insurance companies declined to a 5-year low of 4.80 per cent as on March 31, down from 5 per cent at the end of December 31, 2020. In value terms, it went up by 3.09 per cent from the previous quarter to an all-time high of Rs 9.48 lakh crore as on March 31, 2021.

LIC accounts for over three-fourths of the overall value of the stakes held by insurance companies in equities, it added.

Mutual funds' holding reduced to 7.23 per cent as on March 31, 2021 down from 7.42 per cent as on December 31, 2020, and Haldea said that this is the fourth straight quarter where the MFs have sold their holdings after 24 continuous quarters of an increase.

However, in value terms, the holding of domestic mutual funds went up by 4.81 per cent to Rs 14.30 lakh crore on March 31, 2021 from Rs 13.64 lakh crore on December 31, 2021.

Net outflows by domestic mutual funds stood at Rs 26,810 crore during the quarter, as retail investors booked profits.

On the back of decrease in holdings of mutual funds and insurance companies, holding of domestic institutional investors (DII), which includes domestic mutual funds, insurance companies, banks, financial institutions, pension funds also decreased to a 10-quarter low of 13.03 per cent as on March 31, 2021 from 13.56 per cent as on December 31, 2020.

Net outflows of DIIs stood at Rs 23,124 crore during the quarter, while in value terms, DII holding went up to an all-time high of Rs 25.75 lakh crore as on March 31, 2021, which is an increase of 3.27 per cent over the last quarter.

Haldea said foreign portfolio investors (FPIs) holdings stood at 22.60 per cent as on March 31, 2021, down from 22.74 per cent as on December 31, 2020, despite net inflows of Rs 55,741 crore during the quarter.

In rupee value terms, FPI ownership also reached an all-time high of Rs 44.66 lakh crore as on March 31, 2021, up 6.77 per cent from Rs 41.83 lakh crore as on December 31, 2020.

The percentage holding of the government (as promoter) in companies listed on NSE increased to 5.60 per cent as on March 31, 2021, from 5.22 per cent as on December 31, 2020.

Retail investors' holding went down in 713 companies despite a 15.57 per cent increase in their stock prices, and went up in 863 companies which had the share prices move up by 5.52 per cent, Haldea said, adding that this validates the oft-used phrase that retail buys at the peak and sells at lows.



Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel