Up to 54% stake! FIIs substantially raised their stake in these small cap firms; do you own any?

Foreign institutional investors (FIIs), which offloaded Rs 1.27 lakh crore of shares in FY25, substantially increased their stake in select small cap stocks in the past 12 months. The benchmark equity index BSE Sensex advanced 5% during April 2024-March 2025. On the other hand, BSE Midcap and BSE Smallcap gained 5% and 8%, respectively, during the same period. Meanwhile, heavy selling by FIIs from October onwards kept the market volatile.

Data available with Ace Equity showed that foreign direct investors raised their stake in Iconik Sports and Events (formerly known as ID Info Business Services) to 53.85% as of March 31, 2025.  Notably, they held no shares in the company as of March 2024.

Global investors also held over 25% stake in Leading Leasing Finance and Investment Co, Shoora Designs and Stratmont Industries as of March 2025. Their stake in these companies was at 0% in the corresponding quarter of the previous year.

Sharing his views on FII outflows, Vipul Bhowar, Senior Director Listed Investments, Waterfield Advisors said, “Emerging markets, including India, have underperformed relative to developed markets over the past few decades (USD terms), leading to scepticism among global investors. Compared to other emerging markets, Indian equities appear expensive. Additionally, with corporate earnings in India slowing down and projections indicating a significant deceleration from previous years, recent tax cuts and protectionist policies in the US have led to capital being withdrawn.”

Bhowar further added that historically, India’s markets have attracted foreign institutional investors (FIIs) due to their strong growth potential. If India continues to demonstrate economic resilience, maintain stability in key policies, and provide favourable market conditions, it could encourage increased FII activity.

Among the other major stocks, FIIs also raised their stake in Blue Pearl Agriventure to 23.24% in FY25 against 0% in FY24. They also upped their stake in Elitecon International to 38.30% from 15.49% a year ago. 

They also increased their stake Eraaya Lifespaces, Ahimsa Industries, Sudarshan Pharma Industries, Ujjivan Small Finance Bank, One Global Service Provider, MOS Utility, One Point One Solutions, Pashupati Cotspin, GE Vernova T&D India, Vertexplus Technologies, Unifinz Capital India, Home First Finance Company India, Checkpoint Trends, SpiceJet and Indus Towers by more than 10 percentage points in FY25.

V K Vijayakumar, Chief Investment Strategist, Geojit Investments said, “The turbulence in global stock markets following President Trump’s reciprocal tariffs has been impacting FPI investments in India too. A clear pattern in FPI strategy will emerge only after the ongoing chaos dies down. In the medium term FIIs are likely to turn buyers in India since both the US and China are heading for an inevitable slowdown because of the ongoing trade war. Even in an unfavourable global scenario India can grow by 6% in FY 26. This, along with better earnings growth expected in FY26, can attract FPI investments into India once the dust in the market settles down.”