The percentage holding of private promoters in companies listed on NSE reached an all-time high as on June quarter, while share of government stake in such firms has hit a record low during the period under review, according to a report by primeinfobase.com.
Since 2009, private promoter ownership has been steadily increasing from 33.61 per cent on June 30, 2009, to 44.25 per cent at the end of March 31, 2020, to 44.23 per cent till June 30, 2020.
While 'Indian' private promoters holding has gone up from 26.45 per cent to 34.86 per cent over the last 11 years, 'foreign' promoters' holding has gone up only slightly from 7.16 per cent to 9.57 per cent.
On the other hand, the percentage holding of the government in companies listed on NSE hit an all-time low of 6.36 per cent as on June 30, 2020, down from 6.56 per cent as on March 31, 2020, as per a report by primeinfobase.com, an initiative of Prime Database Group, released on Monday.
Over an 11-year period (since June 2009), such holding has been steadily declining, from 22.71 per cent as on June 30, 2009, due to the government's divestment programme, not enough new listings as also lackluster performance of many CPSEs relative to their private peers, according to Pranav Haldea, MD of Prime Database Group.
Holding of domestic mutual funds in NSE-listed firms reduced to 7.81 per cent during the quarter ended on June 30, 2020, down from 7.96 per cent at the end of the preceding quarter.
This was the first decline on a quarter-on-quarter basis after a gap of 24 quarters. Prior to such drop, it has continously increased from 2.86 per cent as on June 30, 2014, to 7.96 per cent as on March 31, 2020.
Besides, shareholding of Foreign Portfolio Investors (FPIs) also fell to 21.05 per cent as on June quarter from 21.17 per cent as on March quarter.
According to Haldea, FPIs are the largest non-promoter shareholders in the Indian market and their investment decisions have a huge bearing on the stock prices and overall direction of markets.
Retail holding (individuals with up to Rs 2 lakh shareholding) in companies listed on NSE saw an increase to 6.74 per cent during the quarter under review from 6.54 per cent at the end of preceding three months.
However, what is significant to note, is the continuing overwhelming presence of retail investors in mid-cap and smaller companies, which institutional investors typically stay away from, the report noted.
On an overall basis, retail holding went up in a huge 1,018 companies listed on NSE in the last one quarter and the average stock price of these firm in the same period increased by 60.28 per cent.
On the other hand, retail holding went down in 545 companies and the average stock price of such firms slightly rose by 61.08 per cent.
According to Haldea, unlike seen in previous quarters and years wherein retail would typically buy at the peak and sell at lows, the last quarter saw heavy buying by retail making use of the steep fall in share prices due to the coronavirus pandemic.
