Investments in Indian capital through participatory notes (P-notes) were at ₹97,744 crore till August-end, and going forward inflow is expected to remain positive for the rest of the year.

P-notes are issued by registered foreign portfolio investors (FPIs) to overseas investors who wish to be a part of the Indian stock market without registering themselves directly. They, however, need to go through a due diligence process.

According to Securities and Exchange Board of India data, the value of P-note investments in Indian markets — equity, debt and hybrid securities — was at ₹97,744 crore by August-end compared to ₹85,799 crore by July-end. The figure for July has been revised by the regulator from ₹1,01,798 crore posted earlier.

Prior to that, investment level was at ₹92,261 crore by June-end, ₹89,743 crore by May-end, ₹88,447 crore at April-end and ₹89,100 crore by March-end.

Increasing FPI investment

Of the total ₹97,744 crore invested through the route till August, ₹89,844 crore was invested in equities, ₹7,586 crore in debt and ₹315 crore in hybrid securities.

“The rise in P-notes reinforces the fact that FPI investment in the Indian markets is increasing on a continuous basis,” Deepak Singh, Chief Business Officer at Reliance Securities, said.

He further said that India is at the beginning of a capex revival phase. Corporate earnings recovery looks sustainable and premium valuations might sustain.

Robust equity inflows

Divam Sharma, co-founder at Green Portfolio, said equity inflows remained robust in August, and September is also looking positive.

“We also believe that monthly FPI inflows to debt securities have bottomed and should henceforth increase in calendar year 2022,” he added.

FPIs infused a net sum of ₹2,083 crore in equities and ₹12,144 crore in the debt market last month.

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