HDFC Bank, Max Financial, Bandhan Bank among FPI fav shares seeing selloff in results season

A couple of foreign portfolio investor (FPI) favourite stocks such as HDFC Bank Ltd, Max Financial Services Ltd, HDFC Life Insurance Company Ltd and Eicher Motors Ltd have fallen up to 15 per cent since the beginning of December quarter results season on January 12.

FPI selling has intensified mainly in the last four sessions, with Sebi data suggesting FPI outflows of Rs 25,938.39 crore in the period mentioned. Net-net, FPIs are net sellers to the tune of 19,308 crore this month, as per NSDL. A recent rise in US bond yields amid dashed hopes of US Fed rate cut and disappointing quarterly numbers from India Inc are seen as key triggers behind the FPI selling.

"We expect the domestic and FPI volumes to remain tepid during truncated week , as most long only investors stay defensive and wait for clear trading trends to emerge in the last week of January . The coming week will also be event heavy with multiple results and the interim Budget on Thursday February 1," said Jaykrishna Gandhi, Head - Business Development, Institutional Equities at Emkay Global Financial Services.

On Thursday, shares of Max Financial were trading 1.03 per cent lower at Rs 885.05. The scrip has fallen 15 per cent in the results season. FPI owned 50.89 per cent stake in Max Financial. HDFC Life shares are down 13 per cent in the last couple of days. FPIs owned 31.28 per cent stake in this life insurer.

"A lacklustre APE growth in Q3FY24 and our muted expectations for Q4FY24, due to an abnormally high base of Q4FY23 on account of high-ticket bumper sales, are impelling a flat APE performance in FY24," said Emkay Global, which cut its target on HDFC Life to Rs 725 from Rs 750 earlier post the insurer's Q3 results. 

HDFC Bank shares, which saw severe beating since its earnings on January 16, are down 12 per cent in the results season. The stock was trading 1.48 per cent lower at Rs 1,434.35 on BSE.

BOB Capital Markets said HDFC Bank is facing challenges in mobilising low-cost CASA deposits even as term deposit rates continue to rise, which limited its deposit growth to just 1.9 per cent QoQ in Q3FY24. Many brokerages cut their target prices on HDFC Bank post its Q3 results on January 16. FPIs held 52.29 per cent stake in this bank.

Eicher Motors Ltd (30.27 per cent) and UPL Ltd (34.39 per cent), with considerable FPI holdings, fell 10 per cent each during the period. Bandhan Bank Ltd and Axis Bank Ltd have also fallen 5-6 per cent during the period.

 

Also read: Stock recommendations by analyst for January 25, 2024: NMDC Steel, CEAT and PowerGrid

Also read: Laurus Labs shares tank after another 'forgettable' quarter; check latest target price