Shareholding patterns

With construction stocks, along with their infrastructure and real-estate contemporaries, falling out of favour with the markets, have institutional investors — domestic and foreign — also shunned the stocks?

Domestic institutional investors (DIIs) remained invested, reducing holdings in a little under half the stocks in the construction universe over the past two years. Foreign institutional investors (FIIs) on the other hand, have pared holdings in more than half the stocks, even exiting a few.

We considered the quarterly shareholding patterns over the past two years, for 25 of the bigger construction companies to gauge holding patterns.

Increases and decreases

Between March '09 and '10, DIIs increased stakes in 11 of the 25 companies that make up the construction universe. Stocks such as Simplex Infra, CCCL and Ahluwalia Contracts have seen the maximum holding increases by DIIs. Companies have also not seen DIIs completely liquidating their holdings and exiting the stock.

The disfavour for construction stocks appears to have affected FIIs, with 60 per cent of the stocks seeing reduction in FII holdings between March '09 and December ‘10. FIIs had also exited three stocks by end-December '10 — Atlanta, Tantia Constructions and KNR Constructions — where they had stakes of over 5 per cent.

Favoured stocks

Even as FIIs consistently shed stakes, they did push up stakes in a select few. Stocks that found favour, where both DIIs and FIIs hiked holdings, include C&C Constructions, CCCL, Supreme Infrastructure and Marg Constructions.

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