Overseas investors have made net investments of $2.44 billion in the Indian equity market in just a fortnight, taking the total inflow for 2012 so far to a staggering level of over $22 billion.
During December 3-14, foreign institutional investors (FIIs) were gross buyers of shares worth Rs 39,435 crore and sellers of equities worth Rs 26,157 crore — translating into a net inflow of Rs 13,278 crore ($2.44 billion), according to SEBI data.
This takes the net investment by FIIs to $22.22 billion (Rs 1,16,550 crore) so far in 2012, making it the second highest net inflow in a single calendar year since their entry into Indian capital markets in 1992.
In 2010, overseas investors had made net investments of about $29 billion (about Rs 1,33,266 crore).
FIIs, a major participant in Indian stock market, had pulled out $358 million (Rs 2,714 crore) in 2011.
Foreign investors have been betting big on Indian equities in the last few months on the back of a slew of economic reforms initiated by government, pushing up BSE benchmark Sensex by 3,862 points or 25 per cent in 2012 calendar year.
“FIIs continued with the positive bias towards Indian equities as the lack of investment options make the country an attractive destination. India is still considered as a better market compared to other markets in Asia or other emerging markets,” Sudip Bandyopadhyay, MD & CEO, Destimoney Securities, said.
Kishor Ostwal, CMD at CNI Research, said, “India has had an excellent year so far after a disastrous 2011. I think Indian valuations look cheaper compared to historical average.”
Moreover, overseas investors have infused Rs 338 crore ($65 million) in the debt market so far this month. In 2012, so far, FIIs total investment into the debt market stood at Rs 33,621 crore ($6.4 billion).
Besides, the number of registered FIIs in the country stood at 1,750 till December 14, while the total number of sub-accounts was at 6,327.