FPIs Remain Bullish On Indian Equities In June So Far, Infuse Rs 12,170 Crore

An analyst said that initial trends in June showed the FMCG, IT, metals, oil, and gas sectors witnessing major selling, while buying was observed in telecom, realty, and financial services

Foreign investors continued to remain bullish in Indian equities in June so far, making a strong recovery after the general election results. The investors infused Rs 12,170 crore in the segment, as of June 21, while the investors pumped in Rs 10,575 crore in the Indian debt market in the same period, official data from the depositories revealed.

This inflow in the equities was backed by anticipation of continued policy reforms and consistent economic growth, reported PTI. Before this, the investors dumped equities worth Rs 25,586 crore in May owing to election uncertainties and withdrew more than Rs 8,700 crore in April. 

Sharing an outlook, Sunil Damania, Chief Investment Officer, MojoPMS, noted, “Foreign portfolio investors (FPIs) inflow will remain constrained due to the high valuations currently commanded by the Indian equity market.FPIs had been waiting on the sidelines for the election results.”

The overall outflow in 2024 now stands at Rs 11,194 crore in Indian equities. Kislay Upadhyay, smallcase Manager and Founder, FidelFolio, said, “So far in 2024, barring March (Rs 35,000 crore inflow), they have been pulling out from India.Though the general election results were sort of a surprise and resulted in a weaker than expected mandate, markets celebrated that yet again a stable government is formed and government continuity is maintained.”

Explaining the bullish sentiment, Damania said that policy reforms, Chinese economy’s growth, and block deals contributed to the inflows. “First, the continuity of the government assures ongoing reforms. Second, the Chinese economy is decelerating, as evidenced by a 12 per cent decline in copper prices over the past month. Third, certain block deals in the market have been eagerly taken up by FPIs,” he stated.

V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said that the initial trends in investor activity in June pointed out the FMCG, IT, metals, oil, and gas sectors witnessing major selling, while buying was observed in telecom, realty, and financial services.