The Reserve Bank of India (RBI) has removed the restriction on foreign institutional investors (FIIs) purchasing the shares of Maruti Suzuki India (MSI), following the compliance of their prescribed investment limit in the company.
"RBI has...Notified that the aggregate shareholdings in MSI by FIIs under the Portfolio Investment Scheme (PIS) have gone below the prescribed trigger limit. Hence, this company has been removed from the caution list for FII investment and the restrictions placed on the purchase of shares of this company are withdrawn with immediate effect," the apex bank said in a statement.
However, it did not provide details as to when the prescribed limit was crossed and by how much.
MSI is the country's largest carmaker.
The RBI monitors the ceilings on FII/NRI/PIO investments in Indian companies on a daily basis.
For effective monitoring of foreign investment ceiling limits, the central bank has fixed cut-off points that are two percentage points lower than the actual ceiling.
The ceiling for overall investment for FIIs is 24% of the paid up capital of the Indian company and 10% for NRIs/PIOs.
FIIs held 18.71% stake in MSI as per the June quarter shareholding pattern.
In another statement, the RBI notified that FIIs can now purchase equity shares and convertible debentures of Mahindra & Mahindra Financial Services through primary market and stock exchanges under the Portfolio Investment Scheme.
