Nykaa, Paytm, Zomato: Canadian FPI-held stocks take a hit on widening rift

Rising diplomatic tensions between India and Canada is reaching Dalal Street too with concerns that the standoff may impact Canadian investment in the Indian markets. 

Stocks held by Canada Pension Plan Investment Board (CPPIB), which is among the biggest FPIs investing in the domestic market, have come under pressure since developments on the India-Canada tensions unfolded on Monday night.  

Shares of new-age startups including Nykaa, Paytm, Zomato and Delhivery lost 1-5 per cent in the last two sessions. In this order, CPPIB holds 1.47 per cent, 1.76 per cent, 2.37 per cent and 6 per cent stake, respectively, in these stocks. Its cumulative stake is valued at around Rs 5,566 crore in these 4 new age companies.   

Among other key holdings, CPPIB has a 2.68 per cent stake in Kotak Mahindra Bank, valued at over Rs 9,500 crore and 2.18 per cent stake in Indus Towers valued at Rs 1,087 crore. The two stocks were down 1 per cent and 3 per cent, respectively since Monday. 

Shares of ICICI Bank and Wipro have fallen 3 per cent during this period, while Infosys is down 1 per cent. CPPIB owns nearly $11.92 million in Wipro's US-listed shares, around $21.7 million in the US-listed shares of Infosys, and $10 million in those of ICICI Bank. 

The tensions between India and Canada have been simmering since Monday night when PM Justin Trudeau alleged India's involvement in the killing of Khalistani terrorist Hardeep Singh Nijjar. 

Both the sides have expelled diplomats and issued travel advisories against each other. On Thursday, India suspended visa services for Canadian citizens indefinitely, claimed several reports. 

Canada is presently the seventh largest country for foreign portfolio investor (FPI) flows into India.

According to the National Securities Depository Ltd (NSDL), the assets under custody (AUC) of FPIs domiciled in Canada stood at nearly Rs 1.8 trillion ($21 billion) at the end of August.

Almost 85 per cent of these investments are in listed equity, while the remaining in debt and hybrid instruments.

Apart from domestic companies, CPPIB also has large exposure to real estate investment trusts (REITs) and infrastructure projects.