FIIs in no hurry to pick up bargains

Sudhanshu Ranade Chennai | Updated on February 27, 2011

Ever since the Sensex took a 10-per cent tumble early this year, there has been speculation that FIIs may migrate to greener pastures.

Now that the Sensex has fallen another 5 per cent below year-end levels, interest in this question is keener than ever.

SEBI data show that FIIs pulled Rs 4,706 crore out of equities in February (up to 23), on top of Rs 6,484 crore in January. We know that this money did not leave the market altogether; it was invested in debt, into which FIIs funnelled more than Rs 10,000 crore in January alone.

But so far there has been no hard information on how much money FIIs moved out of the country — or into it. Movements of the rupee have yielded no clues.

Now, thanks to a recent speech by the RBI Deputy Governor, Ms Shyamala Gopinath, to the Foreign Exchange Dealers Association, we know that FIIs moved out $3.2 billion (Rs 14,500 crore approximately) between December 1, 2010, and February 4, 2011.

The figure is small. But, like the data from SEBI, it brings out the interesting point that FIIs are in no hurry to pick up bargains.

Published on February 27, 2011

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