Investor confidence in India has declined substantially on a sequential basis from the third to the fourth quarter of FY11, says a JP Morgan Value Notes investment confidence survey.

The survey said investor confidence measures declined from 146.3 to 132.3 during the period in question.

The survey posed six questions on economic situation in India and the world, investment climate, Sensex trends, portfolio appreciation and increase in investments to three categories of investors and solicited ratings on a ‘Likert Scale' from zero to 200, with zero signifying lowest confidence and 200 signifying highest confidence.

All investor categories – the retail, corporate and the financial advisor communities – displayed a decrease in investment confidence in varying degrees.

Retail investor confidence dropped 17.5 points to end the fourth quarter at 142 while corporate confidence lost 8.7 points to end at 123.5.

Financial advisors also lost investment confidence of 15.7 points for the same period.

Corporate confidence in the manufacturing sector rose from 126 to 130 during the three-month period while it slipped 10 points from 159 for retail investors.

Corporate and retail investors lost confidence in the BFSI, retail and hospitality, medical and biotech, services, realty and infra and the IT-ITES-BPO sectors during the last quarter.

Investor confidence fell across six out of the eight cities surveyed with only investors in Chennai and Hyderabad feeling confident. Retail investor confidence in Pune was at its lowest, losing 40 points from 176 in December.

Senior citizens between the ages of 60 to 65 recorded the lowest confidence at 124 points whereas middle-aged investors were the most confident at 149 points.

Investment strategy has turned cautious among those surveyed, with 15 per cent being risk averse, 29 per cent wanting to invest cautiously, 39 per cent wanting to preserve capital and only the remaining 17 per cent willing to take risks.

Related Topics