More than 1,700 new foreign portfolio investors (FPIs) have registered with capital markets watchdog Sebi in the first seven months of the current fiscal, a sign of their willingness to be a part of India's growth story in the long term.
More than 1,700 new foreign portfolio investors (FPIs) have registered with capital markets watchdog Sebi in the first seven months of the current fiscal, a sign of their willingness to be a part of India’s growth story in the long term.
In the entire last fiscal, about 2,900 FPIs had received approval from Securities and Exchange Board of India (Sebi).
The number of FPIs with Sebi’s approval increased to 6,079 at the end of October from 4,311 at March-end, reflecting an addition of 1,768 such investors, according to the latest data from the Sebi.
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FPIs consider India as a preferred and stable market, given its macro-economic stability, long-term growth prospects and ongoing economic and social reforms, market experts said.
Besides, Sebi has decided to offer direct entry to well-regulated foreign investors for investing in corporate bonds, they added.
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FPIs have pumped in Rs 2,800 crore in the equities in April-October period, while they have pulled out over Rs 42,600 crore from the debt markets.
“Demonetisation could to some extent be a contributing factor (to the outflows) as it has some near-term sentiment impact due to general slowdown, but we do not expect it to hamper long-term inflows,” Centrum Broking Fund Manager Ankit Agarwal said.
“The long-term structural story seems intact and emphasis of the government to curb black money and introduction of more transparency could be positively viewed in the long term,” he added.
In a big revamp, Sebi had in 2014 released norms that clubbed different categories of foreign investors into a new class called FPIs.
FPIs have been divided into three categories as per their risk profile and KYC (know your customer) requirements, while other registration procedures have been made simpler for them.
They are granted permanent registration as against the earlier practice of approval granted for one or five years to overseas entities seeking to invest in Indian markets. The registration remains permanent unless suspended or cancelled by the board or surrendered by FPI.