New IPOs can absorb huge FII inflows: Sebi

New IPOs can absorb huge FII inflows: Sebi

If the inflows from foreign institutional investors (FIIs) chase same numbers of papers then obviously prices will rise, but issuance of new papers could absorb that, Sebi Chairman CB Bhave said reporters here.

“I am not saying whether FII inflows are a concern or not... I am saying balancing factor is issuance of papers,” he said. Fund flow from overseas investors has crossed the record Rs 99,700-crore mark this year and is all set to breach the magical Rs 1,00,000 crore mark — for the first time since they were allowed invest here.

Coal India Ltd’s mega initial public offering (IPO), through which the government aims to garner up to Rs 15,000 crore, opens next week. Some other big private as well as PSU public offerings are also in the pipeline.

On the issue of any need to curb the whopping capital inflows, Bhave said that it was for the government and Reserve Bank of India to monitor the situation. “Capital inflows is something which government and RBI look at,” he added.

The whopping capital inflows have raised an alarm among regulators. The sharp rise in FII flows into Indian stocks has pushed up the market.  The BSE benchmark Sensex climbed over 10 per cent in September, a month when the index re-gained the magical 20,000 level after a gap of 32-months.

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