FPIs pump ₹38,098 crore in equities this month; Will inflows sustain in FY25?


Foreign portfolio investors (FPIs) continued their buying streak in March, turning steady buyers in Indian markets. Inflows rose in both debt and equities. Foreign investors extended the modest streak picked up in February after being big sellers in January. Market experts have also highlighted that FPIs also invested in some bulk deals through the stock exchanges this month.

FPIs have bought 38,098 crore worth of Indian equities and the total inflow stands at 51,542 crore as of March 22, taking into account debt, hybrid, debt-VRR, and equities, according to National Securities Depository Ltd (NSDL) data. The total debt inflows stand at 13,223 crore so far this month.


FPI activity in Indian markets

FPIs outflow initially declined in February until they were net buyers by the end of the month, despite high US bond yields. The inflow into Indian equities stood at 1,539 crore and the debt market investment rose to 22,419 crore in February on top of the 19,836 crore bought in January.

The inclusion of government bonds to JPMorgan and Bloomberg debt indices especially triggered foreign fund inflows into debt markets. FPIs turned massive sellers in January 2024 snapping their buying streak as investments saw a sharp uptick in December 2023 after they reversed their three-month selling streak in November 2023.

However, inflow intensified in December on strong global cues after the US Federal Reserve signalled the end of its tightening cycle and raised expectations of a rate cut in March 2024. This led to a crash in US bond yields and triggered foreign fund inflows into emerging markets like India.

For the entire calendar year 2023, FPIs bought 1.71 lakh crore in Indian equities and the total inflow stands at 2.37 lakh crore taking into account debt, hybrid, debt-VRR, and equities, according to NSDL data. FPIs’ net investment in Indian debt market stands at 68,663 crore during 2023.

Overall, only four months in 2023–January, February, September, and October- saw net FPI outflows from Indian equities. May, June, and July each recorded FPI inflows above 43,800 crore.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.

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Published: 23 Mar 2024, 05:49 PM IST


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