FPIs pump in over ₹36,200 cr in equities in Nov, continue as net buyers in Dec

Foreign portfolio investors (FPIs) pumped in more than 36,200 crore in the equities during November. The start of the last month of 2022 has also begun on a positive note with bulls rallying over Indian stocks taking benchmarks Sensex and Nifty 50 to their fresh all-time highs. However, on Friday, markets snapped their 8-day winning streak to end in red as investors cashed in their gains. Going ahead, domestic equities are likely to witness a fair share of money from FPIs, however, its high valuation will be a deterrent.

As per NSDL data, FPIs infused a whopping 36,239 crore in the equities market during November — which is the second highest monthly buying in the current year after August where FPIs invested 51,204 crore.

Equities were top picks of FPIs in November, as they net sellers in other market instruments.

In November, FPIs sold 1,637 crore in the debt market, while their outflow was to the tune of 540 crore in debt-VRR and 214 crore in hybrid.

Overall, in the Indian market, FPIs investment came in at 33,847 crore in November due to strong buying in the domestic equities.

During October month, FPIs made a marginal selloff of merely 8 crore in the equities. The selling, however, was far lower compared to the outflow of 3,532 crore in debts, and 301 crore in the hybrid market. In this month, FPIs were net buyers of debt-VRR to 762 crore. In October, FPIs made their lowest outflow in the current year.

Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services said, “FPIs turned strong buyers in November consistently buying financials, IT, autos, FMCG, capital goods and telecom. They were sellers in financials in October, but were buyers in November.”

Further, NSDL data revealed that FPIs invested 7,437 crore in the first 2 days of December in the equities. A slight buying was seen in the debt market to 394 crore, and 27 crore in hybrid, however, they continued to be net sellers in debt-VRR to 136 crore.

According to StockEdge data, FIIs inflow came in around 22,546.34 crore in the equities during November. However, FIIs are net sellers between December 1st to 2nd to 1,351.17 crore in the stocks.

Last week, the Sensex touched a fresh historic high of 63,583.07 and the Nifty 50 clocked its new lifetime high of 18,887.60. The two benchmarks climbed nearly 4% each between November 21 to December 1st before correcting on December 2.

Markets halted their eight-day gaining spree on Friday with Sensex closing at 62,868.50 down by 415.69 points or 0.66%. Nifty 50 closed at 18,696.10 lower by 116.40 points or 0.62%.

Vijayakumar added that there is no consistency in their sectoral selling strategy.

In the short run, Geojit strategist believes that the most important factor determining FPI strategy is the movement in the dollar index.

He added, “When the dollar index moves up and is expected to trend up, they sell. Conversely, when the dollar index declines and is expected to trend down, they buy. Going forward, India will get its fair share of FPI money. But the high valuation in India will be a deterrent.”


Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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