Total FII holding in HDFC rises to 68.72% in Jul-Sept

The increase in FII holding in HDFC is among the highest for any Sensex company during the quarter ended September 30, 2012.

Updated: Oct 14, 2012, 11:35 AM IST

Mumbai: Shareholding of overseas institutional investors in HDFC has risen to 68.72 percent -- the highest level in five-and-a-half years -- despite foreign entities like Citigroup and Carlyle exiting the housing finance major in recent months.

The cumulative holding of Foreign Institutional Investors (FIIs) in HDFC rose to 68.72 percent in the July-September 2012 quarter, up from 66.74 percent at the end of previous quarter, as per stock exchanges data.

The increase in FII holding in HDFC is among the highest for any Sensex company during the quarter ended September 30, 2012.

Also, the current FII holding of 68.72 percent in HDFC is the highest since five-and-a-half years ago, when it stood at 68.85 percent at the end of quarter ended March 31, 2007.

Experts say that impressive returns earned by some overseas investors in HDFC in the recent past could be the main reason for other foreign entities purchasing the company's shares.

While Carlyle has exited from its about five-year old investment in HDFC (Housing Development Finance Corporation) with nearly double the returns, Citigroup also made impressive gains on its investment.

Carlyle had acquired over 5.2 percent in 2007 at price of nearly 340 per share. A part of this holding was sold in February this year for about Rs 1,400 crore at an average price of about Rs 677 per share.

The remaining 5.7 crore shares, accounting for 3.7 percent stake, were sold earlier this month at a price of about Rs 762 a piece -- more than double the average purchase price by Carlyle.

Citi had also sold its 9.85 stake in HDFC for about Rs 9,300 crore in February.

During the July-September 2012 quarter, HDFC shares swelled by 18 per ent, as against over seven percent gain in BSE's benchmark Sensex. In the same period, FIIs have invested a hefty sum of a little over Rs 40,000 crore on the back of a slew of reforms initiated by the government.

The overall holding of institutional investors also rose to the highest level in four quarters in July-September 2012 period (86.75 percent) -- mostly because of additional purchase of shares by FIIs, as domestic institutions have lowered their exposure considerably in the past one year.

The holding of domestic institutions stood at 18.03 percent as on September 30, 2012, down from 29.05 percent a year ago.