Mumbai:

During the quarter ended 30 June 2003, the FIIs increased their holdings in Ranbaxy from the earlier 22.61 per cent to 24.08 per cent and in Nicholas Piramal from 2.35 per cent to 3 per cent. In Cipla, the foreign institutions increased their holding from the earlier 8.26 per cent to around 7 per cent.

The ADR holders of Dr Reddy's increased their holding in the company by around 2 per cent from 19.32 per cent to 21.48 per cent. But the FIIs reduced their exposure in the company from the earlier 24.15 per cent to 22.73 per cent during the same quarter.

Says Sameer Narayan, a pharma analyst with Enam Securities: "The growth prospects of all these firms are very strong. Big export potential for generic drugs in the world market has attracted many investors into these firms. Visibility of earnings is also high in these firms."

The domestic banks and financial institutions (FIs) also enhanced their holdings in Dr Reddy's, Cipla and NPIL. In Dr Reddy's the banks and FIs acquired another 1.5 per cent while in Cipla the domestic institutions increased their holding to 10.22 per cent from the earlier 9.83 per cent. In Nicholas Piramal, the FIs and banks picked up another 1 per cent during the last quarter.

In the meantime, the stocks of steel, cement and oil and gas companies were the hot favourites of mutual funds in June 2003. Funds also jumped on to the Maruti initial public offering wagon last month.

Says Vipul Dalal of IL&FS Investmart: "Visibility of earnings in the steel, cement and other old economy counters are high as the earnings are expected to grow in the next two quarters. Cement is particularly attractive after the Grasim-L&T deal."

Mutual funds also couldn't resist stocks of companies manufacturing steel and steel products that month, as they made fresh investments in Steel Authority of India Ltd (SAIL), Maharashtra Seamless, PSL, and Jindal Iron & Steel.

SAIL and Maharashtra Seamless were introduced into the HDFC portfolio, while AllianceCapital purchased PSL and Jisco. Exposure to Tisco was also enhanced in a big way. Analysts believe attractive valuations, higher steel prices and a better product mix are likely to keep steel stocks buzzing for another year.