Aug. 14 (Bloomberg) -- India’s biggest shareholders are jumping on Prime Minister Narendra Modi’s bandwagon.
The CHART OF THE DAY shows founders of S&P BSE 200 Index companies increased their holdings at the fastest pace in almost three years, by an average 0.43 percentage point to 55.3 percent in the three months through June. Overseas investors boosted their stakes last quarter by the smallest proportion in two years, 0.85 percentage point to 19.8 percent. The lower panel tracks India’s stock index versus the MSCI BRIC Index of companies from Brazil, Russia, India and China.
Growing confidence among Indian entrepreneurs may help sustain this year’s 24 percent rally in the BSE 200 Index, which has so far been fueled by about $12 billion of foreign inflows. Modi, who led his Bharatiya Janata Party to the nation’s biggest election victory in three decades in May, has pledged to revive India’s economic growth from near the lowest level in a decade. He’s projected to offer more policy details in an Independence Day speech tomorrow.
“Founders are finding the India growth story very solid on hopes Modi will take steps to strengthen the economy,” said Jan Dehn, the London-based head of research at Ashmore Group Plc, which oversees about $70 billion in emerging-market assets. “Bouts of volatility in global markets have impacted the sentiment of foreigners.”
This year’s advance in the BSE 200 is four times bigger than the MSCI BRIC gauge’s 6 percent gain.
Billionaire Anil K Agarwal’s Vedanta Group increased its stake in oil explorer Cairn India Ltd. by 1 percentage point to 59.9 percent in the three months to June 30. Analjit Singh, founder of Max India Ltd., raised his group’s holdings in the hospital chain by a similar amount from the previous quarter to 40.5 percent, data compiled by Bloomberg show.
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