By IANS,
Mumbai : Foreign institutional investors (FIIs) have poured in over $2.67 billion in September alone, fuelling the rise of Indian stock markets.
Till Sep 17, FIIs had invested over $2.64 in the markets and picked up $39.67 million worth of new securities, according to data available with the Securities and Exchange Board of India (SEBI).
In the same time, the 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange has soared over 9 percent and closed at 19,594.75 points on Sep 17.
An expected 8.5 percent economic growth during the current fiscal and robust domestic demand have helped build confidence of not only Indian enterprises, but also foreign fund managers who look to divert funds from their home markets to the emerging regions of growth.
Foreign investment in Indian equities markets has crossed $15.6 billion so far this year.
Analysts say this fund inflow is likely to continue given that the Indian market will give higher returns than most other global destinations.
“FII inflow is likely to be robust in the medium to long-term, as Indian equities are still underowned by foreign investors as compared to their peers in the other emerging markets,” said Madhusudan Kela, chief investment strategist, Reliance Capital, an Anil Dhirubhai Ambani group company.
FIIs had pumped in a record $17.45 billion into the equities market in 2009, but started exiting in early 2010. In January, they were net sellers to the tune of $94.48 million.
But from February, the scenario changed with foreign funds buying scrips worth $269 million in the month. In March it was over $4.3 billion and in April the net buys was over $2 billion.
May, however saw a huge sell-out, with FIIs dumping stocks worth $2.1 billion.
The buying has been fairly consistent since, with FIIs lapping up stocks worth $2.27 billion in June, $3.5 billion in July and $2.4 billion in August.