Norway’s Authorities Pension Fund International, the world’s largest sovereign wealth fund with a portfolio worth in extra of $1.4 trillion, raised its India bets final yr amid a surge in Indian equities.
Its Indian holdings as a share of its complete fairness portfolio rose by 20 foundation factors (bps) year-on-year in calendar yr 2023 to 2.2 per cent, the fund’s annual disclosures present. Contemplating a complete fairness portfolio of about $1 trillion, the fund’s India fairness investments quantity to about $22 billion.
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The rise in India weight got here in a yr that noticed web purchases by overseas portfolio traders (FPIs) to the tune of over $20 billion. India’s benchmark index Nifty 50 rose 20.1 per cent in CY23.
India has the second largest weight in its rising market portfolio after China, whose weight decreased by 70 bps final yr to three.1 per cent. The India weight within the fund’s fairness portfolio stood at 1.6 per cent on the finish of CY21, implying an increase of 60 bps within the final two years.
ICICI Financial institution and Infosys had been the highest two India holdings for the fund, with a market worth of greater than ₹7,000 crore every on the finish of CY23, information from Primeinfobase (Company Database Info) reveals. Among the different prime holdings embrace Axis Financial institution (₹6,416 crore), Varun Drinks (₹3,976 crore) and M&M (₹3,184 crore). The highest 10 investments quantity to a market worth of ₹40,911 crore.
Rising markets accounted for 10.2 per cent of the fund’s fairness investments, decrease than the ten.9 per cent on the finish of CY22.
The fund’s fairness portfolio returned 21.3 per cent in 2023. The fund was invested in 8,859 corporations on the finish of 2023, down from 9,228 a yr earlier.
“Regardless of sturdy inflation, rising coverage charges and geopolitical turmoil, the inventory market rallied after a weak 2022. Greater rates of interest reined in inflation throughout the yr with out sparking a pointy financial downturn. US know-how shares specifically contributed to the optimistic return, pushed primarily by the biggest know-how corporations,” the fund’s annual report mentioned.
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Know-how shares had been the perfect performers in 2023 with a return of 51.9 per cent. The fund’s prime holdings embrace Microsoft ($33 billion), Apple ($31.3 billion), Alphabet ($18.1 billion), Amazon ($16.4 billion) and NVIDIA ($13.5 billion).
The fund has 70.9 per cent invested in equities, 27.1 per cent in mounted revenue, 1.9 per cent in unlisted actual property and 0.1 per cent in unlisted renewable vitality infrastructure.
India’s market cap is at present the fifth largest globally however India’s weight in international indices remains to be low at 1.6 per cent. This could change as market free float rises and a few weight anomalies get sorted out, in line with Jefferies. India will turn out to be almost a $10 trillion market by 2030 — unattainable for giant international traders to disregard, the brokerage mentioned in a latest notice.
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