Shares of Axis Bank surged nearly 4.5 per cent and Yes Bank 3.5 per cent
after the Cabinet approved a composite cap for foreign portfolio
investment (FPI) and foreign direct investment (FDI).
Finance Minister Arun Jaitley in the Budget had proposed to do away with the distinction between different types of foreign investments, especially between foreign portfolio investments and foreign direct investments, and replace them with composite caps.
Mr Jaitley on Thursday said that foreign direct investment, foreign portfolio investment and investments by non-resident Indians would be "clubbed together under a composite cap".
Experts welcomed the move, with TP Ostwal saying that it will be beneficial for the banking sector, particularly for banks where FII limit has been crossed.
Brokerage CLSA termed the move very positive for Axis Bank and Yes Bank. These two banks can make their way into the MSCI index with significant weights, it added.
CLSA said that Axis Bank shares can see buying of stocks worth $700-800 million while Yes Bank $165-185 million.
Among other banking stocks, Kotak Mahindra Bank rose 4 per cent while HDFC Bank rose 1.25 per cent. In comparison, Nifty was up 0.85 per cent.
Finance Minister Arun Jaitley in the Budget had proposed to do away with the distinction between different types of foreign investments, especially between foreign portfolio investments and foreign direct investments, and replace them with composite caps.
Mr Jaitley on Thursday said that foreign direct investment, foreign portfolio investment and investments by non-resident Indians would be "clubbed together under a composite cap".
Experts welcomed the move, with TP Ostwal saying that it will be beneficial for the banking sector, particularly for banks where FII limit has been crossed.
Brokerage CLSA termed the move very positive for Axis Bank and Yes Bank. These two banks can make their way into the MSCI index with significant weights, it added.
CLSA said that Axis Bank shares can see buying of stocks worth $700-800 million while Yes Bank $165-185 million.
Among other banking stocks, Kotak Mahindra Bank rose 4 per cent while HDFC Bank rose 1.25 per cent. In comparison, Nifty was up 0.85 per cent.
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