If foreign institutional investors (FIIs) choose to liquidate Indian shares in the months ahead, sectors such as banking and finance, auto, entertainment and IT may be the most vulnerable.

These are the sectors with the highest-level of FII holdings, and thus, more likely to fall prey to a sell-off.

Calculations based on the latest shareholding patterns (end-March 2013) for companies in the CNX 500 (representing 95 per cent of the market), show that FIIs hold 19 per cent of the overall market value of shares.

But sectors such as banking and finance feature much higher levels of FII holdings. Foreign investors hold 31 per cent of the outstanding market cap in banks and finance companies. Within this space, HDFC, IDFC, Shriram Transport, YES Bank and Federal Bank feature the highest FII stakes at over 45 per cent of their market cap. These stocks fell close to 3.5-6 per cent in Thursday’s trade. The other sectors where FIIs own more than 20 per cent of the outstanding value of shares are automobiles, entertainment, IT and pharma. Within auto, Mahindra & Mahindra and Hero Motocorp are the FII favourites with 35 per cent and 30 per cent, respectively.

In the entertainment space, Zee Entertainment, Hathway Cable and Den Networks feature the highest FII stakes.

In IT, stocks such as Infosys, Hexaware Technologies, Redington India, KPIT and MindTree have found favour with FIIs. Some of these stocks fell 2-3 per cent on Thursday. In the pharma space, Strides Arcolab, Glenmark Pharma, Dr Reddy’s and Lupin have more than 25 per cent FII holdings.

FIIs have in the past month pulled out close to $4.2 billion from the debt market but managed to stay put in the equity markets.

But indications from the US Federal Reserve Chairman, Ben Bernanke, that it could cut back on monetary stimulus has led to fears about FIIs lightening up holdings in stocks as well.

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