Wednesday, April 17, 2013

Domestic institutions, MFs cut stake in banks in March quarter

Our Bureau
Share  ·   print   ·   T+  
Private sector players find favour with FIIs
Chennai, April 16:  
Domestic funds dumped banking stocks in the March quarter even as foreign institutional investors increased their stake in a majority of them.
IndusInd Bank, which entered the Nifty index from April 1, saw the biggest pull out from mutual funds and domestic institutions — holding decreased to 6.08 per cent from 7.87 per cent. However, Bank of India attracted domestic funds, as their holding increased to 0.69 per cent from 0.36 per cent.
So far, about 20 banks have declared March-end shareholding pattern.
Among the banks that have not disclosed their March quarter shareholding include SBI and YES Bank.
Brokerage Prabhudas Lilladher, which met nearly 30 investors in its Asia road show last month, said: “Investor mood for India financials was marred by weak macros though some wanted to seek value in few private banks (ICICI Bank especially).”
According to the brokerage, defensives (Kotak/ IndusInd Bank) were still in favour of investors. Though valuations for PSUs are compelling, investors prefer “to wait for possible headwinds to play out before taking a more structural view,” it added.
FIIs increased their exposure in a big way in Federal Bank (2.39 per cent), Kotak Mahindra Bank (1.73 per cent), IndusInd Bank (1.44 per cent) and Axis Bank (1.38 per cent). ICICI Bank and HDFC Bank also saw a marginal increase in FIIs holding in March quarter.
FIIs reposed faith in private sector banks, despite a sting operation by Cobrapost, an online magazine that alleged money laundering in ICICI Bank, HDFC Bank and Axis Bank. Some officials of these three private major banks, the sting operation alleged, had offered to launder unaccounted money through insurance schemes. All the three have denied any such misdeed by them.
Morgan Stanley, according to March 7 report, said it remains underweight on all State-run banks, except Bank of Baroda, (where it has an equal weight). “The continued high deposit rates will imply continued NIM (net interest margin) pressure and high provisioning. Against this backdrop, banks (PSUs) will struggle to perform. We like private banks (retail lenders) given their much stronger balance sheets.”

Shame Haider
pgdm 2nd sem
Posted by at

No comments:

Post a Comment

Subscribe to: Post Comments (Atom)