Bullish FII: Investors Raise Stakes In Indian Companies With Bumper Earnings, Reinforcing The Growth Story

As major economies, with the exception of US, have struggled to cope with macro and micro factors, pulling the economies of their countries down, India remains an outlier for now. It was just last week, that reports of recission in Japan and UK, two of the largest economies in the world emerged. Meanwhile, things do not appear hunky-dory for others including the German machine (Germany) or the factory of the world, China. India's economy, not only, has not shrunk, but also, is expected to grow at the rate of 7.2 per cent.

Silver-lining in a sluggish world

In what can be seen as a reflection of the same, the market returns and capital flows are intricately linked to earnings growth, and the robust performance of corporate India in the current financial year has attracted significant interest from foreign investors in Dalal Street. Nearly 2 dozen companies that have reported double-digit earnings growth for three consecutive quarters have witnessed a consistent rise in foreign institutional (FII) holding. Among these companies, shares of at least 20 have delivered multibagger returns thus far in the current financial year. Notably, a majority of the stocks experiencing an increase in FII holding belong to domestic-oriented companies, indicating that major investors are optimistic about India's growth trajectory.

The companies bagging big-money

Some of the popular names are Jupiter Wagons, Titagarh Railsystems, Sanghvi Movers, RateGain Travel Technologies, Ramkrishna Forgings, Dixon Technologies, Mrs Bectors Food, Blue Star, Indian Hotels, and Computer Age Management.

These as one could see, belong to different sectors of the economic ecosystem, on one hand you have Jupiter Wagons Limited, an Kolkata-based private manufacturer of railway freight wagons, passenger coaches, along with Titagarh Railsystems, another Kolkata-based rolling-stock manufacturing companies with an average revenue of over Rs 2,500 crore. This could indicate the faith, that is being deposited the manufacturing sector, that is seeing rise, not only because of international requirements, but also, because of local commitments, given the number of rapid transit systems, that are being constructed.

Then you have the all-important, Tech companies, RateGain Travel Technologies, Dixon Technologies and Computer Age Management, reinforcing the importance of the pertinence of tech companies in India's growth story. And then there is mix of FMCG and hospitality complementing each other, with Mrs Bectors Food, Blue Star and the legendary Indian Hotels.

The rise in FII holding primarily in stocks of domestic-oriented companies implies that major investors are placing their bets on the growth potential of India's economy.