Foreign investors have blocked Indian equities with Rs 11,500 crore so far this month mainly driven by bulk investment from the United State based GQG Partners in the Adani Group companies.
Considering the collapse of the US-based banks, Silicon Valley Bank and Signature Bank that dented the overall market, chances are the FPIs may take a cautious stance in their approach, said experts.
According to the depositories data, Foreign Portfolio Investors (FPIs) invested Rs 11,495 crore in Indian equities as on 17 March.
This came in after following a net outflow of Rs 5,294 crore in February and Rs 28,852 crore in January. Prior to that, according to official data, FPIs has infused a net amount of Rs 11,119 crore.
V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services said, "the inflow in March is inclusive of the bulk investment of Rs 15,446 crore by GQG in the four Adani stocks and excluding this, FPI activity in equities represent a strong selling undercurrent.
In this current year, FPIs have till now sold equities to the tune of Rs 22,651 crore.
Himanshu Srivastava, Associate Director, Manager Research at Morningstar India, has credited the latest inflows to better prospects of Indian equities over longer time frames.
Although like many other countries, India too has a rate hike cycle given high inflation levels, the country is still perceived to be relatively better placed with respect to macro conditions compared with other markets.
On the other hand, FPIs pulled out Rs 2,550 crore from the debt markets during its review period and its investing sector stood as a consistent buyer only in capital goods.
FPIs have been alternating in financial services, buying and selling on different fortnights. Since the dominant market is in risk mode following the bank failures in the US and fears of contagion, FPIs are unlikely to turn buyers in the near term, Geojit Financial Services' Vijayakumar said.