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Below is quote on FPI By Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services

FPI flows into India are continuing unabated. The decline in the dollar index to below 100 on Friday, the lowest level in one year, is favourable to emerging markets. India is the largest recipient of FPI flows YTD among emerging markets. The selling in China continues and FPIs were sellers in EMs like Thailand and Vietnam also recently.
In July, through 14th, FPIs have invested Rs 30660 crores in India. This figure includes investment through bulk deals and primary market, too, apart from investment through stock exchanges. (Source: NSDL)
FPIs continue to invest in financials, automobiles, capital goods, realty and FMCG. FPI buying in these sectors have contributed hugely to the surge in prices of stocks in these sectors and the Sensex and Nifty scaling record highs.
Declining dollars is a powerful trigger that can sustain the FPI inflows. The concern, however, is the rising valuations which are getting stretched. The valuations in China (PE is 9) is hugely attractive now compared to valuations in India (PE is around 20) and, therefore, the ‘Sell China, Buy India’ policy of FPIs cannot continue for long.

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