FIIs slash stake in Dr Reddy146;s

FIIs have been consistent sellers in the company8217;s stock because of concerns about shrinking profit margins and dismal financial performance in the past few quarters. Lack of any investment triggers in the company has also kept institutional investors away from the stock. Apart from FIIs, mutual funds too have brought down their holding of 2.93 per cent as on December 2003 by 45 per cent to 1.59 per cent as on June 2004.

Over the past eight months FIIs have sold more than 54 lakh shares to bring their holding down to 13,765,510 equity shares of Rs 5 each, representing 17.99 per cent of Dr Reddy8217;s equity of Rs 38.26 crore. Assuming an average price of around Rs 850-900 for Dr Reddy8217;s scrip during the period, FIIs sold stocks worth Rs 500 crore.

From less than 20 per cent in early 2002, their holding in the company rose to 25.03 per cent by December 2003. But they now seem to have changed their outlook on the company, at least in the short term. While the company refused to comment on why FIIs have been paring their holding, it confirmed they have been sellers.