FIIs or Foreign Instituional Investors' expsoure or interest in the Indian markets is well accounted for with their daily, monthly or yearly 'buy' and 'sell' into the markets being placed on record. Likewise, on an individual stock level, it is crucial in the sense that it indicates their bullishness on an entity and hence participate in its growth journey. Likewise, here are 2 scrips from the small cap m-cap space, where FIIs have sharply raised stake in the Decemeber ended quarter of Cy 2021.
Currently FII stake in the small cap infra company is at a solid 48.15%, which is a 34.81% increase over the September quarter. In the September quarter, FII stake was at 13.34%. Further 6 more FIIs have entered the scrip with a total number of FIIs as of December quarter at 103. Top FII investors in the company are Cintra INR Investments BV, Bricklayers Investment PTE and Govt. of Singapore.
The company initially set up to finance the capital needs of the IRB Group efforts in the infra space now delivers various firsts in the country's road and highways infra space; such as delivering first Build-Operate-Transfer (BOT) project, operating and maintaining India's first expressway project; launching and listing India's first Infrastructure Investment Trust (InvIT); first Indian Company in the sector to tap offshore bond markets and many more.
The company commands a stock price of Rs. 221 per share and has a m-cap of Rs. 13,346 crore.The scrip over a 1-year period gave 94.29% return.
Deepak Fertilizers and Petrochemicals:
In this Fertilizers company, FIIs raised stake by 10.38% in the December quarter to hold in entirety 11.95% stake. Over the period, 34 more FIIs have bought a stake in the firm, with 80 FIIs having stake in the firm. Top FII holders in the fund include SmallCap World Fund, BNP Paribas Arbitrage, Government Pension Fund Global and Fidelity Funds- Pacific Fund.
Deepak Fertilisers and Petrochemicals Corporation Ltd. (DFPCL) is among India's leading producers of fertilizers and industrial chemicals. Set up in 1979 as an Ammonia manufacturer, DFPCL today is a publicly listed, multi-product Indian conglomerate with an annual turnover of over one billion USD with a product portfolio spanning industrial chemicals, bulk and specialty fertilisers, farming diagnostics and solutions, technical ammonium nitrate and value added real estate, which includes India's 1st & largest revolutionary concept retail destination for Home Interiors & Design.
The company's stock quoted at a price of Rs. 486.7 and in the last 1-year has given return of 209%, while its 1-month return is placed at 33%.
Is FII action in a stock/stock market relevant for investors?
FIIs action in the stock/stock market can be of relevance to stock market participants only up to a certain extent as any buying or selling spree by them can be triggered on the backdrop of global as well as domestic factors. Say as in the current case when the Fed is expected to hike interest rates as early as March this year, FIIs may be nudged to sell their holding into the Indian markets, resulting in selling pressure in Indian equities. So, any such action can be taken for a caution stance.
Furthermore, FII action should be looked upon in conjunction with other aspects such as company fundamentals- including EPS, PEG ratio, revenue growth, cash flows and future earnings visibility etc. Besides, key management of the company needs to be researched upon, together with technical parameters.