Top 30 PSU Stocks Experience Surge in FII Holdings; Check if you hold them

Public Sector Undertakings (PSUs) in India have witnessed a remarkable turnaround in recent years, reflecting a robust performance and renewed investor confidence. Three years ago, the market capitalisation of PSU companies listed on the BSE Index stood at Rs 18,19,521.46 crores. This figure has surged by 231.32%, reaching Rs 60,28,419.82 crores, indicating a significant revival in the public sector. This resurgence has also caught the attention of Foreign Institutional Investors (FIIs), who have notably increased their stakes in several PSU stocks, driving substantial returns.

PSU Stocks with Highest FII Holding

As of March 2024, several PSU stocks have recorded the highest FII holdings, underscoring strong foreign investor interest. Power Grid Corporation leads the pack with an impressive 29.82% FII holding, followed by REC Ltd at 19.91%, and NTPC at 17.86%. Bharat Electronics, Power Finance Corporation, and BPCL also feature prominently, with FII holdings of 17.56%, 17.19%, and 16.79%, respectively. Other notable stocks include Container Corporation (16.63%), GAIL (India) (14.17%), HPCL (13.8%), NMDC (12.6%), and Hindustan Aeronautics (12.42%).

PSU Stocks with Highest Increase in FII Holding QoQ

According to our analysis, 30 out of 56 stocks have seen an increase in FII holdings on a quarter-on-quarter basis.

Union Bank of India tops the list with a 2.78% increase in FII holding, currently at 6.75%. NMDC follows closely, with a 2.69% increase in FII holding, now at 12.6%. BPCL, with a 2.58% increase in FII holding, currently at 16.79%, and BHEL, Punjab National Bank also recorded a 1.72% increase in FII holding, now at 4.82%, with a return of 143.14%. Stocks like SCI, NLC India, Cochin Shipyard, Hindustan Copper and Rites also witnessed increased in FII Holdings.

1 Year Returns

Several PSU stocks have delivered exceptional returns over the past year, driven by increased FII interest and robust financial performance. Cochin Shipyard, priced at Rs 1,917.10 with a market cap of Rs 50,435.22 crores, has achieved a staggering return of 578.57%. IRFC, HUDCO, SJVN, and NBCC have also performed well, with returns of 423.48%, 351.52%, 247.94%, and 241.6%, respectively.

Meanwhile, notable mentions include BHEL, REC Ltd, MRPL, MOIL, Rail Vikas Nigam Ltd, Power Finance Corporation, Ircon International, Mazagon Dock, Hindustan Copper, and ITI Ltd, all of which have shown significant returns over the past year.

Additionally, 36 out of 56 stocks have delivered returns of 100% or more over the past year, indicating a strong outperformance among PSU stocks.

A turnaround in Cash Flow

Some PSU companies have notably turned around their cash flow status over the past five years, attracting significant FII interest. Bank of Maharashtra, priced at Rs 66.10 with a market cap of Rs 46,807.88 crores, has increased its FII holding to 1.04%, delivering a return of 131.80%. Mishra Dhatu Nigam, ITI, Union Bank of India, and NMDC have also demonstrated impressive improvements in their cash flow positions, contributing to their attractiveness to FIIs.

Conclusion

The substantial increase in FII holdings in PSU stocks reflects growing foreign investor confidence in the public sector’s prospects. This renewed interest has translated into impressive stock returns, with many PSU companies delivering exceptional financial performance and robust growth. The turnaround in market capitalisation and the significant increase in FII stakes underscore the resurgence of PSUs in India, presenting a promising outlook for investors.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. The information is based on various secondary sources on the internet and is subject to change. Please consult with a financial expert before making investment decisions.