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Among emerging markets, India has the highest year-to-date foreign portfolio investor inflow of $8.8 billion, closely followed by Brazil ($8.1 billion), according to BofA Securities. Most EMs continued to see outflows in Sept 2021, notably South Korea (-$25.5 billion YTD) and Taiwan (-$16.7 billion), the brokerage said.
On the other hand, “DII (domestic institutional investor) inflows at $2.6 billion (vs $3.9 billion in Aug-21) remained strong but softened for the second month,” BofA Securities said.
FPIs $667-b asset base
FPI assets under management were at $667 billion as of September 2021, of which IT (+48 bps over TTM average) and energy (14.3 per cent) saw highest allocation YTD, while financials (34 per cent, -167 bps below TTM average), industrials (-59 bps MoM, -80 bps below TTM average) saw lowest allocations YTD. Discretionary (9.1 per cent, +39 bps MoM), telecom (3.6 per cent,+31bps MoM), utilities (3.3 per cent, +41bps MoM) saw higher allocations.
Despite softening, DII flows remain strong ($2.6 billion vs +$3.9 billion in Aug-21).
“Passive funds ($1.4 billion) saw highest inflows YTD. Within DIIs, there was a sharp rise in multi-cap ($481million, highest since March-21) and mid-cap ($182 million) funds. Arbitrage funds (-$203 million) saw outflows for the first time YTD.” As of September 21, both FIIs and DIIs are overweight on financials and staples and underweight on utilities.
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