Domestic investors lead as mutual fund inflows push DII share to new height

The share of domestic Mutual Funds (MFs) in companies listed on the National Stock Exchange (NSE) reached an all-time high of 9.45% as of September 30, 2024, up from 9.18% on June 30, 2024, driven by strong net inflows of US$ 10.57 billion (Rs. 89,038 crore) during the quarter. Meanwhile, Life Insurance Corporation of India (LIC), the country’s largest institutional investor, saw its share fall to a record low of 3.59% from 3.64% due to profit booking. LIC increased its stake in 78 companies while reducing it to 103 companies. Consequently, the overall share of insurance companies slightly decreased to 5.21% from 5.24%. On the other hand, the share of Domestic Institutional Investors (DIIs) rose to 16.46%, an all-time high, with net inflows of US$ 12.30 billion (Rs. 1,03,625 crore). Foreign Institutional Investors (FIIs) also saw a marginal increase in their share to 17.55%, driven by net inflows of US$ 11.56 billion (Rs. 97,408 crore).

Managing Director of PRIME Database Group, Mr. Pranav Haldea, noted that the gap between the shares of FIIs and DIIs narrowed to a record low of 1.09%, with DIIs holding US$ 911.36 billion (Rs. 76.80 lakh crore), just 6.19% lower than FIIs. The FII to DII ownership ratio also fell to a new low of 1.07%. Despite this, FIIs continue to play an important role in the market, though their influence has diminished. As of September 30, 2024, the combined share of retail and High Net-Worth Individual (HNI) investors stood at 9.58%. During the quarter, DIIs increased their stake in Consumer Discretionary while reducing it in Financial Services. FIIs made similar shifts, raising their allocation to Healthcare and decreasing it in Financial Services. The share of the government as a promoter decreased to 9.71% from 10.64%, while private promoters saw their share rise to 41.34%.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.