Investor wealth rises by Rs 1.73 lakh cr in 2012-13

Investor wealth soared by nearly Rs 1.73 lakh crore to Rs 63.78 lakh crore during 2012-13 on the back of rising stock prices helped by foreign fund inflows.

The BSE Sensex gained 1,431.57 points or 8.23% in 2012-13 fiscal.

Led by the rally in the stock market, the investor wealth soared by Rs 172,945 crore to Rs 63,87,886 crore on March 28, 2013 from Rs 62,14,941 crore in the previous fiscal, 2011-12.

In 2012 calender year, the investor wealth had surged 27% to around Rs 67.7 lakh crore.

The Sensex has however, fell by nearly 4% or 745 points in the first three months of the current calender year.

Market analysts said that possibility of early general elections and concerns over the pace of economic reform process have dented market sentiments.

"Political uncertainty after DMK pulled out of the ruling UPA coalition, continuing debt crisis in the euro zone pertaining to Cyprus bailout and fears of early general elections have dampened investor sentiment off late. Also, FIIs are on a wait and watch mode," said Gajendra Nagpal, CEO of Unicon Financial Solutions.

Foreign Institutional Investors (FIIs) have infused a net amount of about Rs 9,494.47 crore in the Indian stock market in March.

FIIs had pumped in $4.57 billion (Rs 24,440 crore) in February and $4.05 billion (Rs 22,000 crore) in January.

Market participants said the upsurge in foreign fund inflows is on account of a slew of measures taken by the government, including the postponement of General Anti Avoidance Rule (GAAR) implementation by two years to April 1, 2016.

Also, easing of interest rates by Reserve Bank of India (RBI) has boosted FIIs inflow in the Indian equity market.

Last month, RBI had slashed its short-term lending rate or the repo by 0.25% to 7.5% in its mid-quarter monetary policy review. In January, RBI had cut repo and CRR rates by 0.25% each. In April 2012, the central bank had slashed the policy rates by 0.50%.

FII investment in the country's equity market had reached Rs 1,27,455 crore ($ 24 billion) in 2012.

2012 had turned out to be a good year for equities, where the Sensex had gained about 25%, even though the Indian economy faced signs of slowdown.