Offshore India funds, ETFs pump in nearly $6 bn in Jan-Sept

PTI New Delhi | Updated on January 09, 2018

India-focussed offshore funds and exchange-traded funds (ETFs) had pumped in nearly $6 billion in the first nine months of the year.

In contrast, these funds had pulled out $1.73 billion in January-September period last year, according to a Morningstar report.

Offshore India fund — not domiciled in India — receives flow from overseas investors and in turn, invests the money in Indian markets.India-focussed offshore funds and ETFs are a subset of the overall foreign portfolio investor (FPI) flows.

According to the report, India-focused offshore funds had invested $4.96 billion during January-September this year, while those of ETFs witnessed an infusion of $747 million, taking the total to $5.7 billion.

“I still feel that the long-term story is intact and solid and we will continue to get long-term money through the fund route,” said Himanshu Srivastava, Senior Analyst Manager Research at Morningstar India.

During July-September quarter, offshore funds and ETFs together witnessed an inflow of $935 million, which was lower than $2.77 billion seen in the preceding three months.

“One of the major reasons which is working against emerging markets is the increased tension on the Korean peninsula due to the stand—off between the US and North Korea,” Srivastava said.

Besides, India is largely hit due to the delay in the pick-up of economic growth. This, coupled with expensive valuations, makes it a tricky situation, he added.

Published on October 30, 2017

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