FPIs net buyers for 2nd consecutive month in November, invest record sum of Rs 60,358 cr in equities

Foreign portfolio investors (FPI) remained net buyers for the second consecutive month in November by pumping in a whopping Rs 62,951 crore in Indian markets.

For equities segment, this is the highest quantum of money invested ever since the FPI data has been made available by the National Securities Depository Ltd.

According to depositories data, FPIs invested a net Rs 60,358 crore into equities and Rs 2,593 crore in debt segment, taking the total net investment to Rs 62,951 crore between November 3-27.

In October, FPIs were net buyers to the tune of Rs 22,033 crore.

Global investors are preferring to invest in emerging markets more than developed markets as the potential upside is much higher in emerging markets, said Harsh Jain, co-founder and COO at Groww.

Inflows into other emerging markets like South Korea and Taiwan show a similar trend, he added.

"FPIs have invested into top bluechips of India in a big manner. A bulk of the investment that has come in has been into the banking sector. So, the inflow has been concentrated in a few stocks," Jain further said.

Himanshu Srivastava, associate director - manager research, Morningstar India said that "few uncertainties have been behind us in November with the major one being the outcome of US Presidential election".

Attractive valuation compared to the developed markets and weakness in the dollar also supported buying, Srivastava said.

Going forward, the biggest challenge on domestic front will be to bring down Covid-19 cases and get the economy back on the growth trajectory, he said. 

There has been improvement in the macro economic scenario which has so far ensured that FPI flow remain intact, Srivastava noted.

Continuation of accommodative stance by global central banks may ensure flow of foreign investments into emerging markets, including India, he added.