Self-reliance! Mutual funds holding in NSE-listed companies at all-time high in Q4 even as FIIs pull away

MFs have pumped in a robust Rs 81,539 crore during the quarter, according to data sourced from .

India’s largest institutional investor saw its share increase to 3.75% in the said period. Given that commands a lion’s share of investments in by insurance companies, the overall share of in the listed companies went up to 5.40% during the quarter.

LIC has at least a 70% share of investors, which amounts to around Rs 14.29 lakh crore.

Following from the above, the share of domestic institutional investors () as a whole, with net inflows of Rs 1.08 lakh crore during the quarter, increased to 16.05%.

On the other hand, the share of foreign institutional investors () declined to an 11-year low of 17.68%, at the end of March quarter.

The share of FIIs was down by 51 bps quarter-on-quarter (QoQ), resulting in the gap between FII and DII holdings narrowing further to an all-time low in this quarter. The DII holding is now just 9.23% lower than the FII holding.

The widest gap between FII and DII holding was in the quarter ended March 2015, when DII holding was a staggering 49.82% lower than FII holding. The FII to DII ownership ratio also decreased to an all-time low of 1.10 as of March 2024.

"Indian markets are moving towards self-reliance with the share of DIIs set to overtake that of FIIs in the next few quarters," said Pranav Haldea, MD, .

For years, FIIs have been the largest non-promoter shareholder category in the Indian market with their investment decisions having a huge bearing on the overall direction of the market. Markets would tank when FIIs would pull out.

This is no longer the case, according to Haldea as DIIs along with retail investors have now been playing a strong counter-balancing role.

DIIs increased their allocation most to energy, while they decreased their allocation most to information technology. Meanwhile, FIIs increased their allocation most in consumer discretionary stocks while they decreased their allocation most to financial services.

The share of retail investors decreased marginally to 7.5% during the March quarter, while the share of high-net-worth individuals (HNIs) also dropped slightly to 2%.

There were 16 companies in which the trinity of promoters, FIIs, and DIIs all increased their stake during the quarter. These companies include , , , Star Cement, Man Infraconstruction, Share India Securities, Time Technoplast, and Yatharth Hospital Trauma Care Services among others.