FII holding limit hike fuels M&M

DALAL STREET SPIKES

In a subdued market, Mahindra & Mahinda (M&A) managed to buck the trend and ended 1.66 per cent higher after the Reserve Bank of India on Monday hiked the foreign institutional investor (FII) investment limit in the stock to 35 per cent from 24 per cent.

The stock ended higher at Rs 489.75, while the BSE Sensex was down 2.01 per cent. The counter witnessed a volume of 12.64 lakh shares.

The surge in the stock in the last few days has been on the back of strong vehicle sales reported by the company for April 2004, said market analysts.

From a low of Rs 451.50 on May 3, 2004, the stock has now surged to today's close of Rs 493.30. Analysts said M&M has been attracting good buying from institutional investors over the past few months on strong vehicle sales and better earning prospects.

FIIs as on March 31, 2004, have increased their holding in the company to 22 per cent from 17.23 per cent on September 2003.