FPIs invest Rs 20\,574 crore in June so far

Stocks

FPIs invest Rs 20,574 crore in June so far

PTI New Delhi | Updated on June 14, 2020 Published on June 14, 2020

Foreign portfolio investors (FPIs) have pumped in a net Rs 20,574 crore into the Indian capital market in June so far amid increasing inflows into emerging markets due to high liquidity.

As per latest depositories data, FPIs invested a net Rs 22,840 crore in equities but pulled out Rs 2,266 crore from the debt segment between Jun 1-12. This translates into a cumulative inflow of Rs 20,574 crore.

Prior to this, FPIs were net sellers for three consecutive months. They pulled out Rs 7,366 crore in May, Rs 15,403 crore in April and a record Rs 1.1 lakh crore in March.

Harsh Jain, co-founder and COO at Groww, said, “As governments all over the world are taking measures to stimulate their economies, we are seeing more printing of money which is leading to higher liquidity which is a big factor behind more money flowing into emerging markets like India.”

However, Himanshu Srivastava, associate director- manager research, Morningstar India, said FPI inflow in the second week of June was lower as compared to the first week.

“Last week, rights issue of Reliance Industries and a stake sale of 2.8 per cent by Uday Kotak in Kotak Bank were the major draw for the foreign investors.

“In the absence of any major trigger, FPIs went back to adopting a measured approach towards India in the wake of spike in COVID-19 cases in the country,” he said.

He further said FPIs have shifted their focus towards safer investment options like gold or US dollar as against investing in fixed income securities of emerging markets like India, given that the risk levels here are relatively high and returns not commensurate with the same.

Almost all the world economies are staring at a recession. Plus, simmering tension between the US and China also does not augur well for emerging markets like India, which are more vulnerable to geopolitical risks, he said.

Though foreign investors have started to invest in the Indian equity market, it needs to sustain to call it a change in trend and not a short-term investment opportunity. If the situation worsens, foreign investors can again take a flight to safety, Srivastava noted.

“So far, there are no signs of the coronavirus curve flattening in India... Going ahead, the revival of the Indian economy will be one of the key drivers for foreign investors’ decision to invest in Indian markets,” he added.

Published on June 14, 2020

A letter from the Editor

Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
Why did exchanges prefer Thursday for F&O settlement?