FII holding in SKS Microfinance soars to 37% in July-sept qtr

FIIs have been raising their exposure in the firm in the past few quarters, after hitting a record low level of 8.33% during April-June quarter 2012

Going bullish on the country's only listed microfinance player, foreign investors have hiked their stake in SKS Microfinance to an all-time high of 36.9% in the July-September quarter amid a sharp rally in the company's share price.

Foreign Institutional Investors (FIIs), which held 35.83% holding in SKS during July-September 2012, raised its stake to 36.90 at the end of September 30, 2013, as per latest information available with the stock exchanges.

FIIs have been raising their exposure in Hyderabad-based firm in the past few quarters, after hitting a record low level of 8.33% during April-June quarter 2012.

The increase in the shareholding of FIIs coincided with a surge of 17% in the share price of SKS between July and September this year, while the BSE benchmark's Sensex grew by 1% during the period under review.

The stock has taken a major beating since its listing in August 2010 at a price of over Rs 1,000 per share and is currently trading at Rs 160 level per share at the stock exchanges.

The company had debuted on the bourses after sale of shares in Initial Public Offer at a price of Rs 985 a piece.

Analysts believe that various steps taken by SKS including appointment of marketing strategist Jack Trout for its re-branding and repositioning work has helped FIIs to rush towards it.

Besides, the microfinance firm has successfully been able to transfer its debt to securitisation and that has helped the cash flows for the company and improving its credit ratings.

Meanwhile, the number of FIIs in SKS stands at 48 in July-September 2013, up from against 42 at the end of the preceding three months.

Besides, domestic institutional investors stake in SKS climbed to 5.13% for the quarter ended September 30, 2013, from 5.08% in the preceding three months.

On the other hand, the total promoter holding fell to 28.62% during the last quarter from 27.09% in July-September 2012.