Financial Stocks See Worst Foreign Fund Outflows In Over Seven Years In August

Banking and financial shares saw the worst foreign fund outflows in seven-and-a-half years in August as overseas investors continued to sell after Finance Minister Nirmala Sitharaman introduced a buyback tax and a higher levy on the super rich in the budget.

Foreign portfolio investors pulled out $1.24 billion and $584 million from the shares of banking and non-banking financial companies, respectively—about half of the total outflows in August, according to data available on National Securities Depository Ltd. That’s the biggest selloff in the two categories by overseas investors since 2012 when NSDL started recording the data.

Nifty 50 fell for the second straight month in August as increased tax on the super rich, including foreign portfolio and taxing buybacks spooked investors. The finance minister on Aug. 23, however, decided to roll back the enhanced surcharge on overseas investors.

The benchmark NSE Nifty Bank Index, comprising 12 banking shares, tumbled 5 percent during the month, led by the slump in Yes Bank Ltd., RBL Bank Ltd. and State Bank of India.

The overseas investors remained sellers for the second straight month, pulling out $2.4 billion in August—the biggest selloff since October 2018. And it followed the withdrawal of $1.8 billion in July.

Oil and gas, software and services and food, beverages and tobacco stocks also saw foreign fund outflows.

What Foreign Investors Bought In August

Foreign investors funnelled $589 million in insurance stocks—the highest among sectors and the biggest for insurance in five months. Of this, $521 million was pumped in from Aug. 16-31.

Miscellaneous stocks—shares of uncategorised, household and personal products and electric and other utilities—saw the second biggest inflow.

Full details of investments in individual stocks by overseas investors in August were not available. Bulk-deal data from the NSE, however, revealed what some of the foreign funds bought last month.

Aug. 1

• Reliance Infra: KBC Equity Fund acquired 34.17 lakh shares or 1.32 percent equity at Rs 50.05 each.
• Lakshmi Vilas Bank: Eriska Investment Fund sold 20 lakh shares or 0.63 percent equity at Rs 46.33 each.

Aug. 2

• Indian Terrain Fashions: Limiar Fund (Master) LP sold 7.47 lakh shares or 1.97 percent equity at Rs 77.4 each.

Aug. 6

• Essel Propack: Clareville Capital India Master Fund sold 89 lakh shares or 2.82 percent equity at Rs 125.4 each.
• PVR: Artisan Developing World Fund sold 5.3 lakh shares or 1.13 percent equity at Rs 1428.77 each.

Aug. 7

• Deep Industries: Nomura Singapore sold 2 lakh shares or 0.62 percent equity to Rs 110.63 each.
• Soril Infra Resources: Nomura Singapore sold 1.92 lakh shares or 0.61 percent equity to Rs 95.38 each.
• Usha Martin: Nomura Singapore sold 16.52 lakh shares or 0.59 percent equity to Rs 26.65 each.

Aug. 8

• Reliance Infra: KBC Equity Fund sold 24.1 lakh shares or 0.93 percent equity at Rs 47.17 each.

Aug. 12

• Gulf Oil Lubricants: Smallcap World Fund sold 2.64 lakh shares (0.53 percent) at Rs 815.88 each.

Aug. 14

HDFC Life Insurance

• Capital World Growth And Income Fund acquired 1.41 crore shares or 0.7 percent equity at Rs 480.38 each.
• Standard Life (Mauritius Holdings) sold 6.71 crore shares or 3.33 percent equity at Rs 480.7 each.

Aug. 16

• Balaji Telefilms: Gothic Corporation acquired 18.42 lakh shares or 1.81 percent equity at Rs 50.5 each.
• Cox & Kings: State Street Bank & Trust acquired 11.62 lakh shares or 0.66 percent equity at Rs 7.1 each.

Aug. 19

• Reliance Infra: KBC Equity Fund sold 20.65 lakh shares (0.80 percent) at Rs 44.86 each.

Aug. 20

• Hindustan Oil Exploration: Fidelity Funds acquired 6.68 lakh shares or 0.51 percent equity at Rs 102.5 each.

Aug. 21

• NRB Bearings: Acacia Conservation Fund acquired 6.76 lakh shares or 0.7 percent equity at Rs 90 each.
• Gulshan Polyols: Antara India Evergreen Fund sold 19 lakh shares or 4.05 percent equity at Rs 39 each.
• Reliance Naval & Engineering: Morgan Stanley Mauritius sold 53.1 lakh shares or 0.72 percent equity at Rs 1.28 each.

Aug. 22

• Tamil Nadu Newsprint: Emerging Markets Value Fund sold 5 lakh shares or 0.72 percent equity at Rs 176 each.

LIC Housing Finance

• Goldman Sachs acquired 71 lakh shares or 1.41 percent equity at Rs 427.61 each.
• Fidelity Group sold 1.92 crore shares or 3.8 percent equity at Rs 428.36 each.

Aug. 28

• Talwalkars Better Value Fitness: Nissay World Sports Fund sold 1.8 lakh shares or 0.59 percent equity at Rs 8.15 each.
• Talwalkars Lifestyles: Nissay World Sports Fund sold 1.77 lakh shares or 0.57 percent equity at Rs 14.4 each.
• Cox & Kings: University of Texas sold 12.7 lakh shares or 0.72 percent equity at Rs 4.69 each.

Time Technoplast

• Dalton Asia Fund acquired 23.3 lakh shares or 1.03 percent equity at Rs 64.35 each.
• Morgan Stanley Asia sold 21.9 lakh shares or 0.97 percent equity at Rs 64.35 each.

Aug. 29

• Sarda Energy & Minerals: Acadian Emerging Markets Small Cap Equity Fund sold 1.8 lakh shares or 0.5 percent equity at Rs 148.47 each.
• Apollo Pipes: FIL Investments (Mauritus) sold 3.92 lakh shares or 3 percent equity at Rs 330.1 each.

Lemon Tree Hotels

• Franklin Templeton Mutual Fund acquired 1.57 crore shares or 1.98 percent equity at Rs 55 each.
• Van Eck Funds acquired 1.27 crore shares or 1.6 percent equity at Rs 55 each.
• Maplewood Investment sold 4.97 crore shares or 6.28 percent equity at Rs 55 each.