Keeping a track of institutional investors could come in handy when investors are looking to handpick companies for investment. Generally, whenever these large investors ramp up their stake in a company, the sentiment of the street also turns bullish on that company as their level of research and due diligence is beyond the capacity of a small investor.
However, it should also be noted that these large investors could also go wrong, still, small investors’ confidence goes up when these institutions show their faith in the company. In that vein, here’s a list of three Nifty 50 companies that have seen the highest pace of DII buying in the last six months.
Hindalco Industries Limited
The first stock on the list is a metal giant, Hindalco Industries Ltd. (NS:HALC), having a market capitalization of INR 96,271 crores. Metal space has already started to see a very good recovery after a bad start of the year and Hindalco is not different. In fact, Hindalco shares have delivered a new breakout on the daily chart today, surpassing the resistance of INR 440 on a closing basis.
It won’t be surprising if the stock touches a level of INR 500 within the next few weeks. On the shareholding front, DIIs owned 8.68% of the company, as of March 2022 which surged to a whopping 18.5% by September 2022, making it the most aggressive 6-month DII buying amongst all of the Nifty 50 companies.
Infosys Limited
The second stock is from the IT space. Interestingly, two of the top DII buying is in the sectors which were the worst performers of the year for a long time. This shows the importance of buying when everyone is panicking. Infosys Ltd (NS:INFY), which has a market capitalization of INR 6,58,599 crores has remained a laggard up until the last week of September 2022.
Although the YTD return is still negative, at -11.2%, and is still noticeably lower than the 52-week high, but that’s generally when the institutional investors try to get in. DIIs have piled up their stake from 3.61% in March 2022 to 12.79%, by September 2022. Mutual funds have also gone up from 13.49% to 15.21% in the same period.
Britannia Industries Limited
Britannia Industries Ltd (NS:BRIT) is a consumer staples company with a market capitalization of INR 98,723 crores. The stock surged to an all-time high of INR 4,237 after the company posted a stellar Q2 FY23 performance, with the net income rising 46.18% on a QoQ basis to INR 493.28 crores and profit margins being 11.13%, which was the highest since the June 2021 quarter.
DIIs have increased their stake multifold, going from 2.76% in March 2022 to 10.33% in September 2022. Mutual funds are also on the front foot of accumulating this stock, ramping up their stake from 5.17% to 5.92% in the same period.
The above-mentioned companies have seen the highest pace of DII buying in the last 6 months (from the Nifty 50 index). However, that does not guarantee any kind of investment return.