FII cumulative investments in stocks reach $125 bn during 2012
The net inflow of Rs 1.23 lakh crore during 2012 is the second-highest for a year and comes after a net outflow in the previous year 2011-- preparing the ground for even better times ahead in 2013 on the back of continuing reform-push by the government and market regulator Sebi.
At gross level, Foreign Institutional Investors (FIIs) purchased stocks worth about Rs 6.5 lakh crore in 2012 and sold equities to the tune of Rs 5.3 lakh crore -- translating into a net inflow of Rs 1,21,652 crore (USD 23 billion).
This was the second highest net inflow by FIIs in a single calendar year since their entry into Indian capital markets in 1992. In 2010, overseas investors had made a record Rs 1.33 lakh crore (USD 29 billion) net investment into the share market.
However, FIIs had pulled out a net Rs 2,714 crore (USD 358 million) from the share market in 2011.
Despite their unpredictable 'hot money' investment, these overseas entities have been amongst the most important drivers of Indian stock markets.
The huge inflows came despite the number of FIIs registered in India dipping to 1,755 this year from 1,767 at the end of 2011.
Market experts believe the recent reforms initiatives undertaken by the government to boost economic growth and
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