Foreign investors have been aggressively buying Indian equities in November, investing Rs 30,385 crore so far this month, owing to the rupee’s stabilisation and the domestic economy’s resilience in comparison to global counterparts.
Foreign Portfolio Investors (FPIs) are unlikely to become more aggressive in the future, as high valuations in India are a headwind, according to V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Further, valuations in markets like China, South Korea and Taiwan are very attractive now and so more FPI money is likely to move to these markets, he added. According to data with the depositories, FPIs invested a net sum of Rs 30,385 crore in equities during November 1-18. This came following a net outflow of just Rs 8 crore last month and Rs 7,624 crore in September.
FPIs were net buyers worth Rs 51,200 crore in August, up from nearly Rs 5,000 crore in July. Previously, foreign investors were net sellers of Indian equities for nine months in a row, beginning in October of last year. FPI outflows in equities have totaled Rs 1.4 lakh crore so far this year. The recent surge in net inflows can be attributed to the recent surge in equity markets, the Indian economy’s stability in comparison to its global counterparts, and the rupee’s stabilisation.
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