India-dedicated funds stanch FPI sell-off in September, shows data

India-dedicated funds saw inflows of $416 million in September, helping mitigate selling pressure from foreign portfolio investors (FPIs).
 

Conversely, funds investing in global emerging markets (GEMs) and other funds (which include those investing in Asia — excluding Japan and global markets) pulled out $1,274 million and $472 million, respectively.
 

The total outflows from funds tracked by EPFR Global, a data provider, stood at $1.33 billion. Such funds accounted for a bulk of selling pressure from overseas investors the domestic markets witnessed in September.

According to the National Securities Depository (NSDL), total foreign portfolio investor (FPI) outflows from the domestic market stood at a record $1.6 billion in June.

If not for inflows from India-dedicated funds, the FPI outflow tally in September would have crossed $2 billion.

The EPFR fund-flow data primarily tracks mutual funds, exchange-traded funds, closed-end funds, variable annuity funds, and insurance-linked funds.

It does not include investments from hedge funds, proprietary desks, and sovereign wealth funds, which are tracked by NSDL.
 

The assets under management (AUM) of India-dedicated funds have declined 15 per cent in the past year to $39 billion. 
 

The AUM of GEMs have declined 22 per cent to $122 billion during the same period. ­­­