PowerGrid shares slip after FII investment limit hits ceiling

The shares dropped 3% to close at Rs 142.15 on the BSE

Shares of state-owned Power Grid Corporation of India dropped three per cent on Monday after the investment limit meant for foreign investors hit its ceiling.

The Reserve Bank of India has placed restrictions on further purchases of shares of the company by foreign investors. Shares dropped Rs 4.25 to close at Rs 142.15 on the BSE. Experts said the stock, which has seen a good rally in recent months, could be expelled from the MSCI India index due to limitations on further purchase by FIIs. The MSCI India index is tracked by global exchange-traded funds.

“With the stock moving into the FII caution list, we believe it will move out of the MSCI India portfolio,” the brokerage Emkay said.

Shares have gained 40 per cent in 2014, compared to about 35 per cent gain made by the benchmark Sensex.