After India banned TikTok, China is selling off stakes in Indian banks

China-Huawei

Less than a week after India banned social networking app, TikTok and other Chinese apps, China’s central bank has sold at least some of its stake in India’s Housing Development Finance Corp.

People with the knowledge of the matter told Bloomberg which cited filings with the exchanges. It is not clear if the sell-off is a response to India ban on Chinese mobile apps.

The People’s Bank of China has dropped off the list of investors holding at least a 1% stake in the company as of end-June. The PBOC held about 17.5 million shares, accounting for a 1.01% shares, at end-March. It cannot be ascertained if the Chinese central bank continues to holds any stake in the mortgage lender or not.

The PBOC may have sold at least a part of its shares in the open market, Hindu Business Line newspaper reported earlier, citing market sources. HDFC shares fell as much as 2.2% in Mumbai in early trading Friday. The stock dropped 40% from its January record high to its April low but has since rebounded 27%.

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PBOC had increased its stake in India’s largest shadow lender in the 12 months ended March. India in April tightened rules on investments in its companies from neighboring nations including China in a bid to reduce the risk of opportunistic takeovers amid coronavirus-led share price drops.

It is mandatory for publicly-traded companies in India to disclose shareholdings of more than 1% at the end of every quarter. HDFC’s global institutional holders as of the latest statement include the Government of Singapore as well as funds run by Vanguard and Invesco Oppenheimer.

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