Canada-India row: 6 stocks owned by Canada pension fund trade in the red

With the Canada-India diplomatic relations hitting a new low, data compiled from corporate database AceEquity suggests at least six domestic stocks including Kotak Mahindra Bank Ltd, Zomato Ltd and Delhivery Ltd are exposed to Canada. Data showed Canadian pension fund owned 1.5-6 per cent stakes in these companies, as on June 30, which are worth Rs 16,062 crore, as of Wednesday's intraday prices.

In total, foreign portfolio investors (FPIs) in Canada together managed Rs 1,50,871 crore in equity assets under custody (AUC). Canada ranked seventh country-wise, with US and Singapore leading the FPI table, data available from depository NSDL showed.

Kotak Mahindra Bank is the biggest Indian stock bet for Canada Pension Plan Investment Board or CPP Investments. The pension fund owned 4,38,81,500 shares, or 2.68 per cent stake, in Kotak Mahindra Bank, as on June 30, which were worth Rs 9,494.36 crore in Wednesday's trade. Shares of Kotak Mahindra Bank were down 0.45 per cent at Rs 1,789.50 on BSE.

Zomato Ltd comes in at second spot. Canada Pension Plan Investment Board owned 20,35,24,655 shares, 2.37 per cent stake, in Zomato worth Rs 2,050 crore. This stock was down 2.10 per cent at Rs 100 on BSE.

Third on the list is Delhivery Ltd, where the Canadian fund owned Rs 1,884.49 crore worth 4,38,81,500 shares (6 per cent stake). Shares of Delhivery fell 3.3 per cent to hit a low of Rs 413.95 in early trade, but recouped losses as the session progressed.

"Despite the significant investments made by the Canada pension fund in the Indian equity market and the exposure of many Indian IT companies to the Canadian market, the market seems to be taking a more composed stance, viewing the issue primarily as a political one for now," said Parth Nyati, Founder at Tradingo.

Nyati noted that pension funds are known for their long-term investment perspective and that they do not react hastily to such geopolitical events.

"They maintain a strategic outlook and are likely to wait for developments before making any major adjustments. There's a reasonable expectation that this issue will be resolved over time. However, should the tension escalate further, a thorough analysis of the situation will be warranted," he said.

In the case of Indus Towers Ltd, the fund owned 5,86,45,238 shares, or 2.18 per cent stake, worth Rs 1,072.32 crore. This stock slipped 1.49 per cent to Rs 182.35. In the cases of One 97 Communications Ltd (Paytm) and FSN E-Commerce Ventures Ltd (Nykaa), the fund held shares worth Rs 951 crore and Rs 610 crore, respectively. Nykaa fell 2.38 per cent while Paytm declined 2.15 per cent.

The fresh blow to Canada-India relations came in, as the Canadian PM Justin Trudeau alleged the government of India's involvement in the killing of a Khalistani separatist. India rejected the unsubstantiated allegations and, in a tit-for-tat move, asked a senior Canada diplomat to leave the country within five days. This was in a response to a similar move by Canada.

Asia Pacific accounted for just over one-fourth of Canada Pension Plan Investment Board's net assets, which stood at $575 billion at the end of June quarter. Public equities, as an asset class, accounted for 24 per cent of the fund’s holding.

In its first quarter upside, CPP Investments said it committed 160 million Canadian dollars to multiples private equity fund IV, which targets mid-market growth opportunities in India. Besides, it said it invested an additional 537 million Canadian dollars in its Indian toll roads portfolio company IndInfravit Trust, in which it owns a 60.8 per cent stake, to help fund the acquisition of four operating road concessions.

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