FPI inflows at 5,600 cr in Sept so far

New Delhi: Foreign investors have pumped in close to Rs5,600 crore into the domestic equity markets in this month so far on expected growth in consumer spending in festive season and better macro fundamentals compared to other emerging markets.

This comes following a net investment of staggering Rs 51,200 crore in August and nearly Rs 5,000 crore in July, data with depositories showed. There is a clear trend reversal in FPI (Foreign Portfolio Investment) flows from July onwards since when overseas investors turned buyers in India after nine straight months of massive net outflows, which started in October last year. Between October 2021 and June 2022, they sold a massive Rs 2.46 lakh crore in the India equity markets. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said the trend of FPI flows into India is likely to continue. However, if US bond yields continue to rise and the dollar index rises above 110, inflows may be impacted. "I feel FPIs will continue buying Indian equities irrespective of the US Fed outcome," Jay Prakash Gupta, founder, Dhan, said. According to data with depositories, FPIs pumped a net amount of Rs5,593 crore in Indian equities during September 1-9. "FPIs are buying in India because India has the best growth and earnings story among large economies in the world. US, Euro zone and China are slowing down.

India is the bright spot," Vijayakumar said. Shrikant Chouhan, Head - Equity Research (Retail), Kotak Securities, said the Indian markets were buoyed by falling prices and a decline in domestic bond yields. "With falling crude oil prices, expected growth in consumer spending in coming festive season, better macro fundamentals compared to other emerging markets will definitely provide the tailwind for India," Gupta said. In addition, exodus of investments from Russia is finding an alternative in India and funds are looking at diversifying investments away from China are the factors which have prompted resumption of FPI inflows in Indian equities, Hitesh Jain, Lead Analyst - Institutional Equities, Yes Securities, said.