Buoyed by the sound progress in rollout of GST, better corporate earnings coupled with US Fed's decision not to lift interest rates, foreign investors pumped in more than Rs 20,000 crore into the Indian capital market in the month of September. Net investment by FPIs in the country stood at Rs 10,443 crore in equities last month, while the same for debt was Rs 9,789 crore, taking the total inflow to Rs. 20,233 crore , making it the highest net inflow in 11 months and the third consecutive month of positive inflows.
This was the highest net inflow in capital markets since October 2015 when FPIs had infused Rs 22,350 crore. With the latest inflow FPI investment tally in equities surged to Rs 51,293 crore in 2016 while for the debt market stood at Rs 2,441 crore, resulting in a net inflow of Rs 53,734 crore.
The inflow trend is likely to continue in coming weeks too as regulator the Securities and Exchange Board of India (SEBI) has decided to offer direct entry to well-regulated foreign investors for investing in corporate bonds. SEBI) will allow Category 1 (multilateral agencies, sovereign wealth funds) and Category II (banks, insurers, pension funds) FPIs to access the bond markets directly, besides allowing Category III (family offices, trusts) to access the bond markets through the electronic bidding platform.
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