FPIs’ 70% of October inflow concentrates in banking and technology stocks

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National Securities Depository Ltd. (NSDL) suggests that about 70 percent of the foreign portfolio investors (FPI) inflow into Indian equities have concentrated in the banking and technology sectors in the month of October. The portfolio investors have pushed an amount of Rs 16,945 crore into local stocks in October and out of this, nearly Rs 9,500 crore has been invested by them in banking stocks. FPIs’ purchase of private bank’s shares in the month of October is driven by above-the-average September quarter earnings, improved asset quality, and lower valuations because of the recent share underperformance.

Foreign portfolio investors have pumped Rs 3,327 crores into the technology sector and its shares in October as the companies are extremely-rich and their earnings have been consistent even when the backlashes due to COVID-19 severely hit other sectors.

Data suggests that the investors have also increased their share of stakes in automobiles, consumer discretions, capital goods, consumer durables and construction companies. These investors have withdrawn a sum of Rs 871 corers from oil & gas companies and a sum of Rs 847 crores from metals. They have pulled out a total of Rs 350 crores from the telecom and insurance sectors.

The picture attached displays the sectoral investments made by the investors in a descending manner.