Minister of External Affairs S Jaishankar addresses a special NSE seminar on Indian capital markets. The event is being organised by ANMI in association with NSE. Watch.
This comes following a record net inflow of Rs 56,944 crore (USD 8.7 billion) last month, mainly on expectations that BJP's victory in the recently held assembly polls would lead to faster reforms.
Equities attracted net inflows during the just concluded financial year. Debt instruments, on the other hand, took a big hit after remaining preferred investment avenue for foreign funds in recent years.
Earlier, the limit for foreign portfolio investors (FPIs) was Rs 1.52 lakh crore. "Limit for FPIs in central government securities shall be enhanced to Rs 1,84,901 crore," Securities and Exchange Board of India (Sebi) said in a circular, adding that the new limits became effective.
The latest net inflow comes following a net investment of Rs 15,862 crore in the capital markets -- equity and debt -- last month. Prior to that, FPIs had pulled out a total of over Rs 80,000 crore during October-January.
Surprisingly, it is the debt instruments that are taking the biggest hit, after remaining a preferred investment avenue for foreign funds in recent years, even as equities continue to attract net inflows but not enough to compensate the huge outflows from the bond market during the year passing by.
The investment in July is followed by an outflow of Rs 4,373 crore in the preceding two months (April-May). The pull out was mainly due to outflow in debt markets.
To deepen Indian capital markets, regulator SEBI's board will consider proposals, tomorrow, for relaxed norms for REITs and an easier set of compliance rules for foreign fund managers keen to relocate to India
To deepen Indian capital markets, regulator Sebi has lined up wide-ranging relaxations to its norms for REITs while an easier set of compliance rules is in the works for foreign fund managers keen to relocate to India.
FPIs turned net buyers of equities in March after pulling out a massive Rs 41,661 crore from the market in the previous four months (November to February).
The Securities and Exchange Board of India (Sebi) said there will be a separate limit for investment by all Foreign Portfolio Investors (FPIs) in the state development loans (SDLs).
"In an ideal world, the political imperative for growth would not outstrip an economy's potential. In the real world, where social-security commitments, over-indebtedness, and poverty will not disappear, we need ways to achieve sustainable growth."
The move comes after Foreign Portfolio Investors (FPIs) inflow had hit a 7-month high in October. As per data compiled by the depositories, net outflow in equities stood at Rs 2,667 crore between November 2-6, while it was Rs 1,689 crore for debt, translating into a total of Rs 4,356 crore (USD 666 million).
The net inflow in equities stood at Rs 6,650 crore last month, while it was Rs 15,700 crore for debt, translating into a total of Rs 22,350 crore (USD 3.44 billion), as per data compiled by the depositories.
The net inflow by Foreign Portfolio Investors (FPIs) in equities stood at Rs 5,319 crore in July while the same for the debt market was at Rs 4 crore, taking the total to Rs 5,323 crore (USD 842 million), according to the latest data from depositories.
Foreign investors poured a mere Rs 547 crore in Indian capital markets during April-June quarter, after pumping in a whooping Rs 79,000 crore in the preceding three months.
With overseas investors pumping in over USD 3 billion in the Indian capital markets this month, total foreign inflows have touched USD 13 billion since the beginning of the year.
According to the data released by the Securities and Exchange Board of India (Sebi), the total value of P-Note investments in Indian markets (equity, debt and derivatives) increased from Rs 2,08,284 crore in July to Rs 2,11,499 crore at the end of August.
CNBC-TV18‘s Sajeet Manghat reports that according to SEBI data, the stock markets are lowering their dependency on foreign investment flows
Market cap is lower than bank deposits, says Jagannadham Thunuguntla, Strategist & Head of Research, SMC Global Securities Limited