FPI holding: Federal Bank, Sintex Plastics under RBI watch

Mumbai: Reserve Bank will monitor foreign shareholding in Federal Bank and Sintex Plastics Technology so that it does not cross the upper limit of 74 percent.

The boards of both the companies have passed resolutions to hike the limit of foreign investment to up to 74 percent, RBI said.

Earlier, foreign investment in Federal Bank was 49 percent and that in Sintex Plastics was 24 percent.

"The increase is subject to regulation 5(2) and 5 (2A) of Foreign Exchange Management (Transfer or issue of security by a person resident outside India) Regulations, 2000...As amended from time to time, and the onus of compliance with the limits prescribed for the company is on the company," RBI said.

FIIs, NRIs and PIOs (Persons of Indian Origins) can invest in primary and secondary capital markets in India through PIS.

RBI monitors ceilings on FII/NRI/PIO investments in Indian companies on a daily basis.

It has fixed the cut-off points two percentage points lower than the actual ceiling.