Financial Daily from THE HINDU group of publications
Saturday, Dec 03, 2005
Financial Daily from THE HINDU group of publications Saturday, Dec 03, 2005 |
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Stock Markets Markets - Foreign Institutional Investors FIIs continue to make a beeline for Indian bourses Rajesh Abraham
Mumbai , Dec. 2 THE Indian stock markets, even as they trade at all-time high levels, continue to lure foreign institutional investors (FIIs) in a big way. In the first eight months of the current fiscal, a total of 136 new FIIs registered themselves with the Securities and Exchange Board of India. In November alone, 17 new FIIs registered with SEBI, taking the total number of FIIs in the Indian market to 820. FIIs have pumped in $ 5482.09 million into the Indian equity markets in the eight months period from April to November. Except for April and October, the FIIs have been net purchasers in the equity markets. In April and October, they were net sellers for $ 791.31 million and $ 149.50 million respectively. After the net sales in October, the FIIs have come back strongly to make net investments of over $ 900 million in November. "New FIIs, who have not had an exposure in India, are now entering the equity markets in a big way, even at these high levels," said an analyst with AnandRathi Securities Pvt Ltd. "The new FIIs are from Japan, Korea and Australia," he said. The benchmark BSE 30 touched a new life-time high of 9057.97 early on Friday, before closing a shade below the 9000-point mark. The FII investments in the Indian equity markets were the highest this fiscal in June at $ 1823.80 million, when the new FII registered stood at eight. The highest number of new FII registrations in the current fiscal was made in September when 29 FIIs registered with the SEBI. But the FII inflows were comparatively lower at $ 1065.50 million during that month. "You cannot assume that the FII inflows would be the highest during the period when more FIIs get registered," said an analyst with a foreign brokerage. "It (the FII figure) also depends on the activity by the existing foreign funds as well," he said. According to industry officials, more overseas portfolio investments are expected to pour into the country from early 2006. For instance, Greater Pacific Capital, a London-headquartered investment bank, has already announced that it would raise $ 300 million from overseas markets, mainly from the US, for investing in the Indian stock markets. In its second and third phases, spread over 5-7 years, GPC also plans to bring in two more funds worth $ 500 million and $1 billion respectively for the domestic markets, said Mr Ketan Patel, founder and CEO of GPC. Some portion of funds, however, would also go to the Chinese markets, Mr Patel, who was the managing director of Goldman Sachs, before founding GPC, said. "We hope to complete the formalities of registering ourselves as an FII by February-March 2006," he said.
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