Yearender: FII inflows hit $20-bn in 2013, take total to $150 bn

Dec 30 2013, 11:40 IST
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Summary'FIIs are expected to be bullish on the Indian stocks in 2014, despite the US Federal's decision on tapering.'

sum of around Rs 51,000 crore (USD 8 billion) during the year in the segment due to weakness in the Indian currency. In 2012, overseas investors had pumped in nearly Rs 35,000 crore (USD 6.64 billion) from the debt securities.

Since opening up of Indian markets for FIIs in 1992, they have made a cumulative net investment of Rs 6.8 lakh crore (USD 145.7 billion) in shares and withdrew Rs 1.05 lakh crore (USD 25 billion) from the debt segment.

After a stunning 2012, FIIs began 2013 on a positive note and infused more than Rs 46,000 crore in the first two months on the back of various reforms initiated by the government. FIIs continued their positive bias towards Indian equities till May, but the pace of investment slowed down.

However, overseas investors became net sellers of equities between June and August as the US Federal Reserve's announced that it would taper its quantitative easing strategy.

FIIs, once again flocked towards Indian stocks and bought bagful of stocks in September as RBI Governor Raghuram Rajan announced slew of measures to boost the weakening rupee and revive economic growth. After that the inflows continued till the year-end.

"FIIs invested hugely in the domestic equities markets in 2013 because Indian equity markets gave one of the best returns among the emerging countries. Most of the funds were invested in large-cap stocks," Ostwal said.

Bandhopadhyay said, "FIIs showed confidence in the Indian equities during 2013, because Indian markets have given good returns."

According to market experts, FIIs preferred sectors like software, pharmaceuticals and biotechnology; financial services and food, beverages and tobacco among others.

As per Sebi data, the total number of registered FIIs dropped to 1,742 as on December 20, the second straight decline, from 1,759 last year.

However, the number of registered sub-accounts pegged at 6,392 against 6,359 in 2012. The sub-accounts include foreign firms, individuals and institutions on whose behalf FIIs make those investments.

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