Mumbai: Foreign entities have invested more than $19 billion in Indian stocks so far in 2012, the second highest in a year.
Foreign Institutional Investors (FIIs) were gross buyers of shares worth Rs.5.8 trillion and sellers of equities worth Rs.4.8 trillion, translating into net inflow of Rs.99,406 crore, according to Securities and Exchange Board of India data.
This is the second highest net inflow by FIIs in a single year since their entry into Indian capital markets in 1992.
In 2010, overseas investors had made net investments of about $29 billion.
FIIs had sold a net of $358 million in 2011.
Foreign investors are betting on Indian equities in the past few months this year on the back of a slew of reforms initiated by the government, pushing up the benchmark Sensex index by about 20% so far in 2012.
“FIIs continued with the positive bias towards Indian equities as the lack of investment options make the country an attractive destination. India is still considered as a better market compared to other markets in Asia or emerging markets,” said brokerage Destimoney Securities Pvt. Ltd managing director Sudip Bandyopadhyay. “I think India would easily cross $20 billion mark this year.”
Kishor Ostwal, chairman of CNI Research, said “India has had an excellent year so far after a disastrous 2011. I think Indian valuations look cheaper compared to historical average.”
Besides investing in equities, overseas investors have made a net investment of Rs.32,486 crore in the debt market so far this year.