At ₹1,74,663 cr, D-Street records highest foreign inflows in 2023
equities in 2023 were the highest ever in a calendar year as optimism over the economy's prospects in a slowing world, the US Federal Reserve's signal that it will cut rates in 2024 and expectations of the Bharatiya Janata Party returning to power in the next year's general elections drove a flood of money into stocks here. Market watchers said overseas investors may be less enthusiastic about pumping similar amounts into Dalal Street in the new year with rich share valuations seen as the key deterrent to large allocations.
Foreign portfolio investors poured ₹1,74,663 crore into the domestic stock market in 2023, bettering the previous record of ₹1,72,849 crore in 2020.
In 2022, they were sellers to the tune of ₹1,25,633 crore.
«The inflows into Indian equities mirror foreign investors' confidence in the India growth story,» said Sriram Velayudhan, senior vice president, IIFL Securities.
In the past 10 years, overseas investors have purchased stocks here on eight occasions, while being net sellers on two.
In 2023, a chunk of the flows into India have been at the expense of China, which lost favour among global fund managers because of concerns over an economic slowdown, a wobbly real estate sector, mounting internal debt issues and the underperforming stock markets. Brokers said a portion of the incremental flows into emerging markets went into equities in India and South Korea.
«After 2017, it is the first year the net FPI investments are positive in equity and fixed income both,» said Lakshmi Iyer, CEO-investment & strategy, Kotak Alternate Asset Managers.
The flows into stocks here in 2023 hit record levels thanks to the late rush of money.
