Top Indian Stocks held by BlackRock: BlackRock is a global Investment firm incorporated in The United States in 1999. The firm has a presence in 36 countries with clients across the Americas, Europe, Asia, Australia, and EMEA. The Company is an Investment manager to Individuals, Educational and non-profit Organizations, Pension Funds, Insurance Companies, and governments.
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Top Indian Stocks held by BlackRock
BlackRock has set up a BlackRock India Fund to allow its investors to earn a piece of the pie of India’s growing economy. The Fund is Gung-Ho on the Indian Equity Market giving it a 70% weightage of the entire India Fund.
It has given heavy weightage to dominant large Cap Companies of the Nifty50 Index. Now, let us take a look at which Companies have the highest weightage and learn a little more about these giants.
Top Indian Stocks held by BlackRock #1 – Infosys
Infosys is a global leader in digital services and consulting. It was established in 1981 by Mr Narayan Murthy and six engineers in Pune. The Company successfully secured its first client Data Basics Corporation, in New York the same year.
In 1983, Infosys relocated to Bangalore where it set up its permanent headquarters. In 1987 it opened its first international office in Boston and finally went public in 1993. From its humble beginnings in the early 1980s, Infosys grew into a massive IT giant, building a presence in over 56 countries.
Today Infosys operates multiple platforms under its name such as Edgeverve, Infosys Finnacle, Infosys Live Enterprise suite, Infosys Polycloud, Infosys Equinox, and a lot more. The Company earns most of its revenue from the Financial Services and insurance industries (29.8%), followed by Retail (14.5%) and Communication (12.3%).
The Company earns most of its revenue from North America (61.8%), followed by Europe (25.7%). India and the rest of the world bring in 9.9% and 2.6% of revenue respectively.
BlackRock has given the highest weightage to Infosys of about 8.2% in the BlackRock India Fund.
| Particulars | Amount | Particulars | Amount |
|---|---|---|---|
| CMP | ₹1,494.65 | Market Cap (Cr.) | ₹6,01,356 |
| EPS | ₹57.63 | Stock P/E | 24 |
| RoE | 31.20% | RoCE | 40.50% |
| Promoter Holding (%) | 14.90% | FII Holding (%) | 33.60% |
| Debt to Equity | 0.11 | Price to Book Value | 7.42 |
| Operating Profit Margin (%) | 24.20% | Net Profit Margin (%) | 16.40% |
Top Indian Stocks held by BlackRock #2 – Reliance Industries (RIL)
Reliance Industries is India’s largest Private sector Corporation with a Market Capitalization of Rs. 15.8 Lakh Cr. Staying true to its Motto of Growth is Life the Company has grown immensely from a Textile Manufacturer to a mammoth in the Petrochemical segment.
The Story of Reliance begins in 1957 when Dhirubhai Ambani returned from Yemen to set up a small yarn Trading business. This very business transformed exceptionally in the hands of Mukesh Ambani, who joined the board of Reliance in 1977.
His educational background in Chemical Engineering led Reliance to venture into the Petrochemical business and set up the World’s Largest Petrochemical refinery. This refinery in Jamnagar, Gujarat has a capacity of 6.6 Lakh Barrels Per day, along with integrated Petrochemical, port & related infrastructure.
The Company earns ~64% of its revenue from Oil Refining and petrochemicals, while the Retail segment brings in another 25%. Digital Services bring in a meager 2.01%, followed by Oil & Gas which contributes to about 1.19% of revenue. Although O&G brings in a minute amount of revenue, the segment saw a strong growth of 113% over the previous year.
Reliance earned a revenue of Rs. 9.03 Lakh Cr in FY23, which increased by 23.27% from Rs. 7.32 Lakh Cr in FY22. However, Net Profit growth was slow at 9.04%, increasing from Rs. 67,945 Cr in FY22 to Rs. 74,088 Cr in FY23.
RIL has the 2nd largest weightage in the BlackRock India Fund, which is about 7.84% of the fund.
| Particulars | Amount | Particulars | Amount | |
|---|---|---|---|---|
| CMP | ₹2,472.7 | Market Cap (Cr.) | ₹16,46,464 | |
| EPS | 98.59 | Stock P/E | ₹23.50 | |
| RoE | 8.94% | RoCE | 9.14% | |
| Promoter Holding (%) | 50.30% | FII Holding (%) | 22.60% | |
| Debt to Equity | 0.44 | Price to Book Value | 2.13 | |
| Operating Profit Margin (%) | 17.60% | Net Profit Margin (%) | 8.47% |
Top Indian Stocks held by BlackRock #3 – HDFC Bank
HDFC Bank or Housing Development Finance Corporation Bank is India’s largest Private-sector Bank with deposits of Rs. 18.83 Lakh Cr. The Bank covers India with 7821 branches across the country. 34% of its branches are located in Semi-Urban, followed by Metro cities (28%).
The Bank was a subsidiary of the now-merged HDFC Ltd, which was India’s largest Housing Finance entity. HDFC Ltd was founded in 1977, by Late Shri HT Parekh. He envisioned providing middle-class Indians with cheap loans to provide better house ownership opportunities.
The success of HDFC Ltd led to the birth of HDFC Bank which would go on to make India’s financial inclusion even stronger. The Bank was incorporated in 1994 and received RBI’s nod as a Scheduled Commercial Bank in 1995. It was one of the first few banks to receive RBI’s approval.
On April 4, 2022, HDFC Bank & HDFC Ltd announced an intention to merge with a timeline of 12-18 months to complete the merger. The merger intended to improve efficiency across the Financial Conglomerate, especially to consolidate the Housing loan divisions of both entities.
HDFC Bank’s (Pre-Merger) Net Interest Income increased by 20.6%, increasing from Rs. 72,010 Cr in FY22 to Rs. 86,842 Cr in FY23. Net Profits increased at a marginally higher rate of 21.21%, from Rs. 36,391 Cr in FY22 to Rs. 44,109 Cr in FY23.
The Company has the third highest weightage in BlackRock India Fund of 6.89% as of FY23.
| Particulars | Amount | Particulars | Amount |
|---|---|---|---|
| CMP | ₹1,654.45 | Market Cap (Cr.) | ₹12,38,464 |
| EPS | ₹79.25 | Stock P/E | 17.1 |
| RoE (%) | ₹17.39 | RoA (%) | 2.07% |
| Promoter Holding (%) | 0% | FII Holding (%) | 52.10% |
| GNPA (%) | 1.12% | Price to Book Value | 2.92 |
| Net Interest Margins (%) | 4.10% | Net Profit Margin (%) | 27.00% |
Top Indian Stocks held by BlackRock #4 – Axis Bank
Axis Bank is India’s third largest Bank, with deposits worth Rs. 9.46Lakh Cr as of FY23. The bank currently has about 4,900 branches spread across the country and has operations in Singapore, Dubai, and London among other major global cities.
The Bank was promoted by Unit Trust of India (UTI), Life Insurance Corporation of India (LIC), General Insurance Corporation of India (GIC) and National Insurance Company (NIC). It started its operations in 1994.
FY23 marked the completion of the acquisition & merger process of Citibank India Consumer Business. The management’s focus on increasing and improving margins led to an increase in CASA growth of 21%.
This eventually led to an increase in Net Interest Margins of over 55bps, which increased from 3.47% in FY22 to 4.02% in FY23. The Bank earns 64% from Interest it charges on advances, 18% from its other investments & 14% from Commission or brokerage.
Axis Bank’s Net Interest Income rose from Rs. 33,132 Cr in FY22 to Rs. 42,946 Cr in FY23, growing by 30% in a year. At the same time, Net Profits of the Company fell by 23%, from 14,207Cr to 10,918Cr in FY23.
BlackRock India Fund maintains a high weightage in Axis Bank of 5.19% as of FY23.
| Particulars | Amount | Particulars | Amount |
|---|---|---|---|
| CMP | ₹1,123.25 | Market Cap (Cr.) | ₹3,43,806 |
| EPS | ₹40.66 | Stock P/E | 13.1 |
| RoE (%) | 18.84% | RoA (%) | 1.82% |
| Promoter Holding (%) | 8.22% | FII Holding (%) | 53.00% |
| GNPA (%) | 1.44% | Price to Book Value | 2.37 |
| Net Interest Margins (%) | 4.02% | Net Profit Margin (%) | 10.22% |
Top Indian Stocks held by BlackRock #5 – Tata Consultancy Services (TCS)
Tata Consultancy Services or TCS is the flagship IT business from the house of TATA, providing Global IT & Consultancy Services. TCS was incorporated by the efforts of the man who went on to be referred to as The Father of Indian IT, his name is Faqir Chand Kohli.
F.C. Kohli was a Graduate of the Master of Science from Massachusetts Institute of Technology (MIT). After a short stint working in America, he returned to India & joined Tata Electric Company. Eventually worked up his way to becoming Director of the Company.
In 1969, he helped set up Tata Consultancy Services, at the request of JRD Tata. 4 years after incorporation, the Company received its first IT offshore contract from the US. In 1989, the Company signed a US $10 million contract with the Swiss Clearing Corporation, a major milestone for the Company.
The Company went on to cross many such milestones in the past 54 years to become India’s largest IT giant, both in terms of Revenue and Market Cap. Today, TCS is a global leader in Cloud, Cognitive Business Operations, Consulting, and Cybersecurity.
TCS earns 38.2% of its revenue from Banking, Financial Services and Insurance Companies. Communication and Retail segments contribute to about 16.7% and 16.6% respectively. Healthcare and manufacturing contribute to about 10.9% and 9.4% respectively.
The Company earned a revenue of Rs. 2.28 Lakh Cr in FY23, which increased by 17% from Rs. 1.95 Lakh Cr in FY22. Despite strong Revenue growth, Net Profits increased by only 10%, increasing from Rs. 38,450 Cr in FY22 to Rs. 42,303 Cr in FY23.
BlackRock India fund has given a weightage of 4.92% to Tata Consultancy Services in its fund.
| Particulars | Amount | Particulars | Amount |
|---|---|---|---|
| CMP | ₹3,669.05 | Market Cap (Cr.) | ₹13,14,971 |
| EPS | ₹115.19 | Stock P/E | 29.00 |
| RoE | 46.90% | RoCE | 58.70% |
| Promoter Holding (%) | 72.30% | FII Holding (%) | 12.50% |
| Debt to Equity | 0.08 | Price to Book Value | 12.9 |
| Operating Profit Margin (%) | 24.10% | Net Profit Margin (%) | 18.80% |
List of Stocks Held by BlackRock
The list below puts together 10 Top Stocks Held by BlackRock
| Name | CMP | Mkt Cap | Weightage (%) |
|---|---|---|---|
| Infosys | ₹1,494.65 | ₹6,01,356 | 8.20% |
| Reliance Industries | ₹2,471.6 | ₹16,46,464 | 7.84% |
| HDFC Bank | ₹1,654.75 | ₹12,38,464 | 6.89% |
| Axis Bank | 1,123.25 | ₹3,43,806 | 5.19% |
| Tata Consultancy Services | ₹3,669.05 | ₹13,14,971 | 4.92% |
| Maruti Suzuki India | ₹10,361 | ₹3,13,764 | 4.69% |
| ICICI Bank | ₹1,037.85 | ₹7,11,237 | 4.49% |
| Larsen & Toubro | ₹3,423.7 | ₹4,67,353 | 3.63% |
| Ultratech Cement | ₹9,949.85 | ₹2,81,162 | 3.37% |
| Mahindra & Mahindra | ₹1,691.5 | ₹2,07,066 | 3.01% |
Conclusion
The BlackRock India fund has a total of 40 holdings with a collect PE ratio of 25.21 as of 31st October 2023. The Fund currently manages assets worth US $470 million. However, the fund has garnered returns of only 156.90% since its inception, which was in 2006.
The poor performance of the fund could be attributed to the comparatively slow performance of the heavyweights such as Infosys and Reliance. These Companies have given 115% & 105% in the past 5 years respectively.
So, do you think the BlackRock India fund is an accurate representation of the Indian Stock market? Do you think the fund needs to exit or add any stocks in their fund? Do let us know in the comments below.
Written by Nasir Hussain
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