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As spat went public, FIIs, MFs upped stake in Anil's firms

BS Research Bureau in Mumbai | June 20, 2005 12:23 IST

Foreign institutional investors and mutual funds have increased their holdings in Reliance Energy and Reliance Capital in the quarters between September 2004 and March 2005 -- the feud between the brothers became public on November 17, 2004.

Both these companies will now be controlled by Anil Ambani. In contrast, the FIIs have reduced their holding Reliance Industries and Indian Petrochemicals Corporation Ltd that have gone to Mukesh Ambani.

FIIs sold 1.88 crore (18.8 million) equity shares of Reliance Industries in the six months from September 2004 to March 2005. But they bought 1.18 crore (11.8 million) shares of Reliance Capital and 12.86 lakh (1.3 million) shares of Reliance Energy during the period.

FIIs started offloading equity shares of Reliance Industries and IPCL much before the start of the dispute between the two brothers. They reduced their holdings in Reliance Industries by 1.08 per cent and IPCL by 5.04 per cent during the last financial year.

The Reliance 'ownership issue'

FII holding in Reliance Energy and Reliance Capital, in the same period, has risen by 4.69 per cent and 17.32 per cent, respectively.

In Reliance Industries, the stake of FIIs declined from 22.63 per cent in the March 2004 quarter to 21.98 per cent in June.

They then increased their holding to 22.85 per cent in the September quarter and further to 22.97 per cent at the end of the December quarter. However, at the end of March 2005 quarter, FIIs reduced their holding in the company to 21.55 per cent.

Merrill Lynch Capital Markets, Espana SA SVB, Government of Singapore, HSBC Global Investment Funds-Mauritius and Goldman Sachs Investment-Mauritius had more than one per cent stake apiece in the company in December 2004 quarter.

These entities reduced their holdings to below one per cent at the end of March 2005 quarter. Citigroup Global Markets Mauritius is only the FII that holds over one per cent stake in the company in March 2005 quarter.

FII holding in Reliance Energy, on the other hand, increased from 12.98 per cent in March 2004 to 17.73 per cent in December 2004. At the end of March 2005 quarter, the FIIs held 17.67 per cent stake in the company.

Emerging Markets Growth Fund Inc. (2.44 per cent), Citigroup Global Markets Mauritius (2.27 per cent) and the New Economy Fund (2.38 per cent) are the major FIIs that have more than doubled their holdings in Reliance Energy over the last one year.

In Reliance Capital, FIIs increased their holding from 4.40 per cent in March 2004 to 16.18 per cent in December 2004. The FIIs held 21.72 per cent at the end of March 2005 quarter.

Goldman Sachs Investment-Mauritius (7.26 per cent) and Citigroup Global Markets-Mauritius (4.42 per cent) are the major FIIs that increased their holdings in Reliance Capital.

Mutual funds holdings in Reliance Industries declined from 1.83 per cent in March 2004 to 1.70 per cent at the end of March 2005 quarter and of IPCL from 6.18 per cent to 5.83 per cent.

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