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Canadian pension fund-held stocks in India fall as diplomatic row heats up

21 September 20234 mins read by Angel One
The biggest investor, the Canada Pension Fund, is unlikely to review their investments in India, according to various market experts.
Canadian pension fund-held stocks in India fall as diplomatic row heats up
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The India-Canada relationship is deteriorating as both countries have declared the expulsion of each other’s diplomats. This action comes in the wake of Canadian Prime Minister Justin Trudeau’s accusation that Indian government agents may have connections to the assassination of Khalistani terrorist Hardeep Singh Nijjar, further straining their diplomatic ties.

At the same time, large Canadian pension fund managers have invested a lot of money, in Indian companies and projects. These investments cover areas like clean energy, building projects, and banks.

According to the data, Canada is the seventh-largest country in the world in terms of holding assets under custody or, as per the investments made in India. According to the latest data from NSDL, Canada has invested a total of Rs 1,77,335 crore in India.

Following is the FPI AUC country-wise ranking:

Country Equity Debt Debt VRR Hybrid Total
USA 22,31,200 29,715 1,949 7,038 22,69,903
Singapore 3,89,650 51,320 70,046 12,548 5,23,564
Luxembourg 3,91,401 24,250 6,076 731 4,22,458
Mauritius 3,13,526 17,344 40,412 1,280 3,72,561
Ireland 2,73,700 11,263 6,626 689 2,92,278
United Kingdom 2,85,017 1,662 1,713 827 2,89,220
Canada 1,50,871 21,443 1,507 3,514 1,77,335

* All figures are in Rs in Crore

Breaking down the total investment made by Canada in India, Rs 1,50,871 crore is invested in the equity markets, which accounts for 85% of their total investment amount. On the other hand, 12% of the total investment amount, which is Rs 21,443 crore, is invested in debt.

Let’s move on to the companies in which a major pension fund, namely the Canada Pension Plan Investment Board, is a shareholder and their respective holding percentages.

Company Name Holding % in March 2023 Holding % in June 2023 % Change
Delhivery 6.02 6.00 -0.33%
FSN E-Commerce 1.46 1.47 0.68%
Indus Towers 2.17 2.18 0.46%
Kotak Mahindra Bank 4.34 2.68 -38.25%
Paytm 1.75 1.76 0.57%
Zomato 2.33 2.37 1.72%

* All figures are in Rs in Crore

As per the data above, only two companies where the Canada Pension Fund has reduced their stakes and the rest remained stable.

Not only are these stocks trading in the red, but major indices like Nifty50 and Sensex are also trading in the red.

According to a PTI report, experts believe that the recent tensions between India and Canada are unlikely to have a significant impact on trade and investments between the two countries. This is because economic relations between them are primarily motivated by commercial interests and considerations. As well various analyst also believes that major investment fund is unlikely to reduce their stakes in the said companies.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.

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