Amidst the escalating diplomatic and political row between India and Canada, a number of stocks in which Canadian pension funds Canada Pension Plan Investment Board (CPPIB) and Caisse de dépôt et placement du Québec (CDPQ) have invested bore the brunt of selling.

Zomato, in which CPPIB held a 2.4 per cent stake at the end of June, ended 0.9 per cent lower at ₹99.15; FSN E-Commerce, which operates fashion and beauty retailer Nykaa, fell 2.5 percent; Indus Towers fell 1.8 per cent; and One97 Communications (Paytm) settled 1.4 per cent lower. Kotak Mahindra Bank fell 1.9 percent. The fund also owns stakes in US-listed securities of Infosys, Wipro, and ICICI Bank, all of which were losers on the Indian bourses.

CPPIB reportedly has a portfolio worth over $21 billion in India, and it has stakes in about 70 Indian-listed companies.

CDPQ’s investments in India at the end of December 2022 were around $6 billion. One of its major portfolio companies is Piramal Enterprises, in which it holds about 2.9 per cent. The stock ended two per cent lower at ₹1,046.65.

Through its subsidiary, Ivanhoe Cambridge, CDPQ is also a major player in the real estate sector in India through joint ventures with other private equity firms and real estate developers. For instance, it has teamed up with Bain Capital and Macrotech Developers for a $1 billion platform to invest in the logistics sector in India. It also has a partnership with Singapore’s Mapletree for a nearly $2 billion platform to make investments in niche office spaces.

While the equity markets were weak on Thursday following the US Federal Reserve’s hawkish commentary on inflation, market watchers said that some of the sell-off was also triggered by the rising tensions between India and Canada.

They said that if the situation grows worse, there may be more heavy selling in the stocks.