Indian market ‘attractive’ proposition for FPIs; net investment at Rs 3,944 cr in Sep so far

Foreign portfolio traders (FPIs) have put in Rs 3,944 crore to date on a internet foundation in home markets in September, with individuals appear heading to “attractive” funding locations like India for potential higher returns.

Overseas traders purchased equities price a internet Rs 1,766 crore and put in Rs 2,178 crore within the debt section between September 1 and 18, depositories information confirmed.

This translated into a complete internet funding of Rs 3,944 crore through the interval underneath overview.

Prior to this month, FPIs remained internet patrons for 3 consecutive months.

They had invested Rs 46,532 crore in August, Rs 3,301 crore in July and Rs 24,053 crore in June on internet foundation.

“This could be attributed to the excess liquidity, which is available in the global markets, making its way into Indian equities” Himanshu Srivastava, affiliate director – supervisor analysis, Morningstar India, stated.

Also, the rebalancing of FTSE’s Global Equity Index Asia Pacific ex Japan and China may have additionally attracted flows, given the addition of few Indian shares into the index and elevated weightages in few, he added.

Regarding funding within the debt section, Srivastava stated that amid aggressive bond shopping for by the US Federal Reserve, the yields there have come down and this could possibly be one of many causes for FPIs to search for different enticing funding locations like Indian debt markets, which may probably provide higher returns.

Rusmik Oza, govt vice chairman, head of elementary analysis at Kotak Securities, stated, “The investment in Indian markets during the period under review came even as FPIs remained consistent sellers in emerging markets internationally on both weekly and monthly basis. FPI flows remained positive in developed markets like US and Europe.”

This has largely been as a result of the valuations of different rising markets had reached unattractive ranges whereas India’s valuations had been nonetheless enticing compared, he stated.

Harsh Jain, co-founder and COO at Groww, stated, “The US Fed has indicated that it plans to keep the interest rates near zero for the foreseeable future while also printing money and this makes parking money in the US and other developed markets a poor proposition and makes emerging markets (like India) seem attractive.”