Investments through P-notes rise to Rs 1.62 lakh cr

In December, P-note investments in Indian markets was at Rs 1.51 lakh cr

Foreign investments into Indian markets through participatory notes (P-notes), a preferred route for high net worth individuals (HNIs) and hedge funds, stood at Rs 1.62 lakh crore (about $30 billion) in January, according to the latest data released by the Securities and Exchange Board of India (Sebi).

In December, P-note investments in the Indian markets was at Rs 1.51 lakh crore (around $28 billion).

P-notes allow HNIs, hedge funds and other foreign institutions to invest in Indian markets through registered foreign institutional investors (FIIs), while saving on time and costs associated with direct registrations.

Notably, investments in Indian shares through P-notes was at Rs 1.77 lakh crore in November and Rs 1.75 lakh crore in October on policy reform measures taken by the government and its initiatives to address tax-related issues.

Besides, the value of P-notes issued with derivatives as underlying stood at Rs 1.05 lakh crore at January-end.

The quantum of FII investments through P-notes increased to 11.83 per cent in January, up from 11.3 per cent in the previous month. FIIs, the key driver of Indian markets, poured in Rs 22,000 crore ($4 billion) into the country's equities in January. Additionally, FIIs also infused $550 million into the debt market during the period under review.