Reason For Foreign Portfolio Investors (FPIs) Is Investing Over Rs 38,000 Cr In Indian Market?
Foreign Portfolio Investors (FPIs) have demonstrated a strong resurgence in their investment activity in Indian equities this month, injecting over Rs 38,000 crore amid positive domestic economic prospects and a favorable global economic outlook.
This influx of investment follows a modest investment of Rs 1,539 crore in February and a significant outflow of Rs 25,743 crore in January, as per data from the depositories.
Also Read: What is US-Japan Security Pact Upgrade and Implications? (investonomic.co.in)
As of now, FPIs have turned their investment positive by Rs 13,893 crore in equities in 2024 and Rs 55,480 crore in the debt market.
Himanshu Srivastava, Associate Director at Manager Research at Morningstar Investment Research India, pointed out that FPIs have emerged as major buyers in March, driven by improved global economic conditions and a positive Indian macroeconomic scenario.
The recent market correction has also presented a buying opportunity for FPIs, further boosting their investment activity.
Experts believe that the robust GDP growth and expectations of potential rate cuts by the RBI in the latter half of fiscal 2025 have also contributed to the influx of FPIs into the Indian markets.
While FPIs turned net sellers last week, the overall trend has been positive, with a significant inflow of Rs 13,223 crore into the debt market by FPIs this month.
This investment surge in debt markets is partly due to India’s bonds being included in Bloomberg’s Emerging Market Local Currency Government Index and related indices from January 31 next year.
VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, noted that the sustained FPI flows into debt are driven by the potential investment of around USD 25 billion once Indian bonds are included in the JP Morgan EM Bond Fund and Bloomberg Bond Index by June 2024. This anticipation has led FPIs to front-run their investments in the debt market.
Also Read: 1.26 लाख करोड़ रुपये का निवेश: कैबिनेट ने सेमी कंडक्टर (investonomic.co.in)
Reason For Foreign Portfolio Investors (FPIs) Is Investing In Indian Market? While FPI inflows into debt are expected to continue, a sharp surge may be unlikely due to the recent rise in US bond yields.
Despite this, the overall outlook for FPI investment in Indian equities and debt remains positive, supported by strong economic fundamentals and favorable global economic conditions.
 Is Investing Over Rs 38,000 Cr In Indian Market?){kind=link}