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FPIs turn net sellers in October; pull out Rs 12,278 crore

"Foreign brokerages like Merril Lynch, UBS and Nomura have downgraded India due to excessive valuations. This might have prompted FPIs to sell on a sustained basis," said V K Vijayakumar, chief investment strategist at Geojit Financial Services.

October 31, 2021 / 06:10 PM IST
Representative image

Representative image

After two months of buying, foreign portfolio investors (FPIs) have turned net sellers in October by pulling out Rs 12,278 crore from Indian markets. As per depositories data, FPIs took out Rs 13,550 crore from equities but invested Rs 1,272 crore in the debt segment during October 1-29.

The total net outflow stood at Rs 12,278 crore during the period under review. FPIs were net buyers in August and September.

"Foreign brokerages like Merril Lynch, UBS and Nomura have downgraded India due to excessive valuations. This might have prompted FPIs to sell on a sustained basis," said V K Vijayakumar, chief investment strategist at Geojit Financial Services. FPIs have been sellers in software during the first half of October. This is profit-booking since they are sitting on big profits.

However, they have been buyers in banks and autos where there is valuation comfort, he added. Three IPOs are expected to raise Rs 30,000 crore from the market in the next few days that are expected to get heavily oversubscribed and, therefore, there will be a huge drain of money from the secondary to the primary market.