Small Cap Stocks with High FII Holdings: Many investors prefer small cap stocks over mid cap and large cap companies in the hope of higher returns. With a low base and a huge addressable market, small companies can grow at a faster rate. To that, add an additional layer of high FII holding.
But, how do you go about picking the best ones from such a large pool? Well, in this article we’ll get you a list of the top small cap stocks with high FII holdings which you can add to your watchlist.
Small Cap Stocks With High FII Holdings
In this article, we shall be talking about the business models, recent developments and a few financial metrics of the companies. Later, we present a table which includes more such companies. So without further ado, let us jump in.
Small Cap Stocks with High FII Holdings #1 – Aster DM Healthcare
|CMP||₹342||Market Cap (Cr.)||₹16,993|
|Promoter Holding||42%||FII Holding||38.8%|
|Debt to Equity||0.5||Price to Book Value||3.79|
|Net Profit Margin||4.0%||Operating Profit Margin||13.6%|
Aster DM Healthcare is a leading provider of healthcare services in the Gulf Cooperation Council (GCC) and India. The company operates hospitals, clinics, pharmacies, labs and medical facilities across UAE, Saudi Arabia, Oman, Qatar, Bahrain, Jordan, and India.
Aster’s operations in India are concentrated in the southern states. In total, the healthcare services provider operates 33 hospitals, 127 clinics, 527 pharmacies, and 229 labs & PECs.
The company employs more than 31,222 employees out of which 3,998 and 9,204 are doctors and nurses respectively. It has a current capacity of 5,866 hospital beds.
Aster has a promoter holding of 42% and a high FII holding of 38.8%. Various international marquee funds such as Olympus Capital, Rimco India and Steinberg hold stakes in the company.
The company has a market capitalization of Rs 16,993 crore and currently trades at a P/E of 47. It has a debt-to-equity ratio of 0.5 and a RoE of 11.3%. It earned a revenue of Rs 11,933 crore in FY23 while posting an EBITDA of Rs 1,595 crore.
Small Cap Stocks with High FII Holdings #2 – Elgi Equipments
|CMP||₹510.3||Market Cap (Cr.)||₹16,360|
|Promoter Holding||31%||FII Holding||28.4%|
|Debt to Equity||0.4||Price to Book Value||11.02|
|Net Profit Margin||12.2%||Operating Profit Margin||14.4%|
Founded in 1960, Elgi Equipments is a manufacturer of industrial air compressors such as oil-lubricated compressors, oil-free electric-powered rotary screw compressors, diesel-powered portable screw compressors, oil-lubricated and oil-free reciprocating compressors, centrifugal compressors, dryers, air receiver tanks, and other air accessories.
Its products are used in multiple industries including agriculture, mining, textiles, construction, automotive, healthcare, aerospace & defence, glass manufacturing, water treatment, metal fabrication, etc.
Elgi operates 3 manufacturing facilities in India, Italy and the USA which produce over 400 products. It employs over 2,000+ across the world and has a large network of 400+ international distributors.
It has a promoter holding of 31% and a high FII holding of 28.4%. Pari Washington, Nalanda India, Wasatch Emerging India, First Sentier Investors and other renowned foreign funds hold shares of this air compressors manufacturer.
Elgi Equipments earned a net profit of Rs 370 crore on sales of Rs 3,041 crore in FY23 clocking a net profit margin of 12.19%. The stock offers high RoE and RoCE of 30.9% and 32.6% respectively.
Small Cap Stocks with High FII Holdings #3 – AAVAS Financiers
|CMP||₹1,661.95||Market Cap (Cr.)||₹13,245|
|Promoter Holding||39%||FII Holding||35.0%|
|Debt to Equity||3.1||Price to Book Value||3.97|
|Net Profit Margin||26.7%||Operating Profit Margin||72.8%|
Founded in 2011. Aavas Financiers is a financial services company that provides a variety of loans and advances for home construction, home, small ticket size, MSME business, emergency credit line, loan against property, etc.
It has a large network of 348 retail branches and present AUM of Rs 14,650 crore and advances of Rs 1,068.2 crore with a net interest margin (NIM) of 8% and return on assets (RoA) of 3.16% respectively. The majority of the branches of Aavas are spread in the states of Rajasthan, Maharashtra, Madhya Pradesh and Gujarat.
The financing company earned a net profit of Rs 429.64 crore on an income of Rs 1,608.76 crore in FY23. With a P/E ratio of 29, it has a market capitalization of Rs 13,245 crore.
Aavas Financiers has a promoter holding and high FII holding of 39% and 35% respectively. Multiple renowned foreign institutions including Kedaara Capital, Vanguard, Bank of America, Capital Group and Partners Group hold stakes in the company.
Small Cap Stocks with High FII Holdings #4 – Computer Age Management Services
|CMP||₹2,609.6||Market Cap (Cr.)||₹12,681|
|Promoter Holding||19.9%||FII Holding||32.6%|
|Debt to Equity||0.0||Price to Book Value||15.01|
|Net Profit Margin||29.3%||Operating Profit Margin||43.3%|
Computer Age Management Services or CAMS is a technology-driven largest registrar and transfer agent of mutual funds in India with a majority market share of 69%. It provides its services to 9 of the 15 largest Indian mutual fund houses of India.
Broadly, CAMS operates through a PAN-Indian network of 280 service centres located in 25 states and 5 union territories. Its portfolio of services to MFs, AIFs, and insurance companies includes API, E-mandate and UPI autopay, FIP integration, integration, AI-focused data analytics, onboarding, fund accounting and operations, and more.
CAMS has a promoter holding of 19.91% and a high FII holding of 35.78% respectively. It counts reputed international institutions such as Goldman Sachs, Arisaig Asia, Fidelity Investment, Smallcap World, and JP Morgan as its shareholders.
The company is debt-free and earned a net profit of Rs 285.25 crore on sales of Rs 971.83 crore in FY23. It has a market capitalization of Rs 12,073 crore and currently trades at a P/E of 41.
Small Cap Stocks with High FII Holdings #5 – Amara Raja Batteries
|CMP||₹664||Market Cap (Cr.)||₹11,210|
|Promoter Holding||28.1%||FII Holding||35.2%|
|Debt to Equity||0.0||Price to Book Value||2.05|
|Net Profit Margin||6.7%||Operating Profit Margin||13.0%|
Part of the Amara Raja Group, Amara Raja Batteries (ARBL) is India’s one of the largest producers of lead-acid batteries. It was established in 1985 and has grown to have a market capitalization of Rs 11,210 crore.
ARBL makes advanced chemistry cells and battery packs for mobility & storage applications and integrated power systems, and industrial & EV chargers. Furthermore, it is also engaged in the business of recycling batteries.
The battery maker caters to automotive and industrial customers and has a current capacity of 19 million units for 4-wheelers, 30 million units for 2-wheelers, and 2.3 Bn Ah for industrial batteries respectively. It sells its batteries under the brand names of Amaron and PowerZone.
Amara Raja has a promoter holding and high FII holding of 28% and 35.2% respectively. Multiple reputed FIIs hold the shares of Amara Raja Batteries such as Clarios Arbl, Vanguard, Nalanda, and others.
The battery maker earned a net profit of Rs 694.53 on sales of Rs 10,388 crore in FY23. The company is debt-free and has a RoE of 14.1%.
List of Small Cap Stocks with High FII Holdings
The table below puts together the names covered above along with many others.
|Company Name||CMP||Market Cap||FII Holding %||Industry|
|Aster DM Healthcare||₹338||₹16,879||38.80||Healthcare|
|Angel One||₹1,783.15||₹14,729||17.04||Stock Broking|
|Elgi Equipments||₹510.05||₹16,360||29.33||Compressors / Pumps|
|AAVAS Financiers||₹1,667||₹13,190||35.00||Financial Services|
|Aegis Logistics||₹357||₹12,510||18.34||Gas Logistics|
|Computer Age Management Services||₹2,609.6||₹12,681||35.80||Financial Services|
|Amara Raja Batteries||₹664||₹11,341||35.20||Batteries|
|Mahanagar Gas||₹1,058||₹10,446||32.40||Gas Distribution|
|Lemon Tree Hotel||₹109||₹8,556||25.48||Hospitality|
|Ujjivan Financial Services||₹506||₹6,096||40.48||Financial Services|
|Edelweiss Financial Services||₹57||₹5,384||31.40||Financial Services|
As we conclude our study of ‘small cap stocks with high FII holdings’ we can say that institutional investors prefer structurally sound businesses which have a large market ahead of them for growth.
For your investing analysis, how much weight do you give to the shareholding structure? Furthermore, what other things do you keep in mind while investing in small cap stocks? How about we continue this conversation in the comments below?
Written By Vikalp Mishra
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