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About 140 fresh foreign portfolio investors (FPIs) registered with SEBI in April, indicating that India remains an attractive destination, according to latest data with the markets regulator.
This comes on the top of close to 3,500 new foreign FPIs registering with SEBI in the last fiscal year ended March 31.
FPIs consider India a preferred and stable market given its macroeconomic stability, long-term growth prospects and ongoing economic reforms, experts said.
Furthermore, several measures taken by the Securities and Exchange Board of India (SEBI) added to its attractiveness, they added.
Going ahead, there are a few areas which FPIs will focus on — impact of GST on the economy in the short run; economic growth has not yet picked up, which is contrary to expectations, and they would want to see signs of improvement in it, Himanshu Srivastava, Senior Research Analyst — Manager Research at Morningstar Investment Adviser India said.
“Also, the US Federal Reserve has hiked rates so far three times and more rate hikes could see some money moving out of emerging markets. The rupee is also appreciating and with markets surging too, profit booking at regular intervals will also happen,” he added.
According to SEBI data, the number of FPIs with the markets regulator’s approval rose to 7,947 at the end of April 2017, from 7,807 at the end of the preceding fiscal, an addition of 140 such investors, according to the latest data from SEBI.
Recently, SEBI raised the FPI investment limit for government debt, permitted them to invest in unlisted corporate debt as well as securitised debt instruments and allowed direct entry to well-regulated foreign investors to invest in corporate bonds.
In a big revamp, SEBI in 2014 had released norms that clubbed different categories of foreign investors into a new class called FPIs.
They have been divided into three categories according to their risk profile and KYC (know your customer) requirements, while other registration procedures have been made simpler for them.
They are granted permanent registration as against the earlier practice of approval granted for one or five years to overseas entities seeking to invest in Indian markets. The registration remains permanent unless suspended or cancelled by SEBI or surrendered by an FPI.
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