FII inflows into stocks touch $9b this year

Overseas investors have pumped in about Rs 8,381.10 crore (US$1.68 billion) in the Indian equity market in the month of March, taking the calendar year to date total to a whopping Rs 43,950.70 crore (US$8.89 billion).

During March, Foreign Institutional Investors (FIIs) were gross buyers of shares worth Rs 63,795.10 crore, while they sold equities amounting to Rs 55,413.80 crore, translating into a net investment of Rs 8,381.10 crore, as per data available with market regulator Sebi.

With FIIs having already poured nearly US$9 billion so far this year, inflows from the investors are likely to touch US$10 billion in the next few weeks, analysts believe.

“Their investments in the first quarter of this year is one of the highest investments in any quarter in the last 10-12 years. FII inflows are likely to cross US$10 billion mark in the next few weeks,” Religare Securities Executive Vice President & Head (retail research) Rajesh Jain said.

Jain said the quantum of FII inflows goes to show that they still have confidence in the Indian economy. Regarding the P-notes, he said Finance Minister has given a positive statement and that was the reason behind the rally in the market on Friday.Participatory Notes (P-Notes) are instruments that allow foreign institutional investors (FIIs), which are not registered with market regulator SEBI, to invest in the Indian equity market.

Meanwhile, the foreign fund houses have sold Rs 6,588.60 crore (US$1.29 billion) in the debt market last month. This takes their overall net investments into debt markets to Rs 4,157.30 crore (US$812.80 million) this year.

FIIs had mostly stayed away from Indian equities in 2011 pulling out Rs 2,812 crore and instead, flocked towards the debt market with a net investment of Rs 20,293 crore.