Foreign portfolio investors (FPIs) turned net buyers in 2019 so far. FPIs were net sellers with Rs30,524.33 crore in 2017-18 and Rs6,735.39cr in 2018-19. This year so far, FPIs are net buyers with Rs4,856.67cr, according to the latest data available on BSE. Moreover, they invested Rs12,000 crore in just first week of November. The latest depositories data showed that FPI infused a net Rs 6,433.8 crore in equities. Inflows accelerated since corporation rate cut, lifting benchmarks by 13 per cent this year so far. Continuing their buying spree, foreign portfolio investors (FPIs) infused a net Rs 17,722 crore into the Indian markets in November so far amid encouraging domestic and global cues.
FPIs are pouring money into the domestic market at an unprecedented pace. The net investment by overseas investors into the equities cash segment has topped $6 billion (Rs 44,000 crore) in the past two months.
The rolling two-month FPI flows into the domestic market currently is the highest since May. The sharp flows have helped the benchmark Sensex and the Nifty surge 13 per cent in just two months. The earnings-boosting move of lowering corporation tax rates in September, coupled with easing monetary policy globally, are seen as the reasons for.
According to depositories data, overseas investors pumped in a net sum of Rs 17,547.55 crore into equities and Rs 175.27 crore in the debt segment during November 1-22, taking the cumulative net investment to Rs 17,722.82 crore.
FPIs were net buyers in the preceding two months as well. They infused a net Rs 16,464.6 crore in October and Rs 6,557.8 crore in September into the domestic capital markets (both equity and debt).
However, some experts said FPIs are still wary of increasing their allocation to the Indian markets.
Umesh Mehta, head of research at Samco Securities said: "FPIs have become relatively cautious on India given the high valuations and Nifty hovering near its all-time high levels. Huge divergence between the large and small/midcaps is making them weary to commit further in a big way to the Indian bourses."
Also, the expectation of weaker GDP numbers in the coming months, among other factors, is making them "hesitant to invest full throttle", he added.
Commenting on the FPI flows, Harsh Jain, co-founder and COO at Groww, said that "for inflows to be very large in quantity, we might have to wait a bit longer or hope for some big economic factors to play out."
Investments via P-notes rise in Oct
After declining for four consecutive months, investments through participatory notes (P-notes) in the Indian capital market marginally rose to Rs 76,773 crore at the end of October.
P-notes are issued by registered foreign portfolio investors (FPIs) to overseas investors who wish to be part of the Indian stock market without registering themselves directly after going through a due diligence process.
Before registering gain in October, investments through P-notes had been declining continuously since June, according to the latest data from markets regulator Sebi. PTI