Institutions desert Financial Technologies stock

Reliance MF, Fidelity among sellers; 26 MFs, 46 FIIs exit as NSEL crisis takes a toll

Top institutional investors, which had put their faith and money on the Financial Technologies (FT) stock, have voted with their feet following the Rs 5,600-crore scandal at subsidiary National Spot Exchange (NSEL).

The details have come to light in the latest shareholding pattern filed by the company to the exchanges. The total number of institutional shareholders in the transaction software provider, a parent of exchanges around the world, almost halved to 81 from 156 at the end of the June quarter.

At the end of June, 28 mutual funds held 7.52 per cent in the company. At the June stock price of around Rs 800, the total MF exposure in 3.46 million shares would have been worth Rs 277 crore. Now, just two local institutions hold shares, less than 1,600. At today’s price, these shares will be worth around Rs 2.6 lakh. Reliance Growth Fund, which held 4.06 per cent, and Birla Sun Life Frontline Equity, which held 1.05 per cent, have been major sellers this quarter. Both names do not figure in the names of investors holding one per cent or more.

Among the foreign institutions, Acacia Partners, Acacia Institutional Partners and Fidelity’s Mauritius based fund are sellers. The number of foreign institutions with exposure to the stock fell from 113 to 67. Their holding fell to 17.35 per cent from 24.22 per cent earlier.

Blackstone, which held 7.02 per cent and Citi Ventures’ funds are among the few institutions which have stayed put, despite the 90 per cent crash in prices since last Diwali.

One institution that has taken a contra bet by buying into FT is Government Pension Fund Global, which has popped into the large investors list with a stake of 2.79 per cent.

The other group of investors which have bought into this selling spree is the small investor, holding less than Rs 1 lakh worth of stock. The number of such investors went up by 60 per cent to 72,564. Some 27,224 retail investors entered the stock during the quarter, more than doubling their combined holding to 17.8 per cent.

There was no change in the promoter group shareholding, with 45.6 per cent. With the stock slated to go out of the futures and options from November 1, its prospects look bleak, say analysts.