FPIS invest ₹8,000 crore in Indian mkts in just four trading sessions
Foreign investors have infused close to ₹8,000 crore into Indian equities in the first four trading sessions of June as risk-on sentiment improved amid rapidly falling new Covid cases and robust corporate earnings.
The inflow comes following a net withdrawal of ₹2,954 crore in May and ₹9,659 crore in April, data showed.
Going ahead, improvement in the scenario on the coronavirus front and pick-up in the vaccination drive may attract higher foreign portfolio investors (FPIS) investments, Himanshu Srivastava, Associate Director—manager Research, Morningstar India, said.
According to the data, FPIS put in a net sum of ₹7,968 crore in the market during June 1-4.
Prior to April’s outflow, FPIS had been infusing money in equities since October. They invested over ₹1.97 lakh crore in equities during October 2020 to March 2021. This included a net investment of ₹55,741 crore in the first three months this year.
“With Covid numbers rapidly falling, more foreign investors are feeling comfortable investing in the Indian economy,” Harsh Jain, Co-founder and COO, Groww, said.
Though big parts of the country remain locked down, some areas with low cases are starting ease restrictions following which certain parts of the economy are starting to function again, he added.
Making a similar statement, Morningstar India’s Srivastava said that “signs of improvement in the coronavirus situation with daily Covid-19 cases falling consistently in India over the last few weeks have provided comfort to foreign investors. The daily case count has come down below 1.5 lakh mark, along with improving recovery rate.” “The good quarterly results and a positive earnings growth outlook over the longterm prompted FPIS to turn their attention again on Indian equities. In addition to this, better than forecasted GDP number also boosted investor sentiments,” he added.
Divam Sharma, co-founder of Green Portfolio, said that fourth quarter results from most of the listed players continue to surprise foreign investors on the positive side. In addition, there is high optimism with global large economies opening up, exports going up, and vaccination being pushed across the globe, he added.
Apart from equities, FPIS have poured just ₹22 crore in the debt markets during the period under review.
“Debt continues to be a laggard in terms of inflows as the visibility of rate of interest rising is still low in the near future and there is a rising inflationary pressure from high liquidity resulting in money chasing risky assets to maintain the purchasing power of money,” Green Portfolio’s Sharma said.