FPIs turn positive on Indian equities; pump in Rs 84 billion in March

Foreign investors have infused over Rs 84 billion in the Indian equity markets so far in March on expectations of rebound in corporate earnings and easing of global oil prices.

However, they pulled out nearly Rs 100 billion from the debt markets during the period under review, depositories data showed.

Net inflow by foreign portfolio investors (FPIs) in equities stood at Rs 84.4 billion during March 1-23.

This comes following an outflow of over Rs 110 billion from equities and more than Rs 2.5 billion from the debt markets last month.

The positive sentiments in equities could be attributed to a likely strong rebound in corporate earnings over the next two quarters and ease of global oil prices providing a relief on the macro front, said Ajay Bodke, CEO and Chief Portfolio Manager PMS at Prabhudas Lilladher.

"Equity had massive outflows in February (due to global macro concerns and high Indian valuations) which might have come back in March due to reasonable valuations and oil nations SWF (sovereign wealth fund) pumping money in India," Harsh Jain, COO at Groww, said.

Regarding the outflow from the debt markets, Jain said FPIs withdrew money from the segment in both February and March probably due to the surge in interest rates increasing in home markets as well as Indian rupee depreciation outlook due to crude price and fiscal deficit.

So far this year, overseas investors have put in a net sum of Rs 1118 billion in equities, while they have withdrawn a net amount of over Rs 17 billion from the debt markets.