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Quote on FPI investments into equity by Dr. VK Vijayakumar, Geojit Financial Services
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Below is quote on FPI investments into equity by Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services
"FIIs have turned big sellers in Indian equity markets in October. Up to 29th FIIs have sold equity worth Rs 11114 cr. With the final figures including the last 2 days of trading getting added, this will be the largest FII sell figure in 2021. The last 8 days of trading saw sustained selling by FIIs. Foreign brokerages like Merril Lynch, UBS and Nomura have downgraded India due to excessive valuations. This might have prompted FIIs to sell on a sustained basis.
FIIs have been sellers in software to the tune of Rs 5406 cr during the first half of October. This is profit booking since they are sitting on big profits. However, they have been buyers in banks and autos where there is valuation comfort.
Three IPOs are expected to raise Rs 30000 crores from the market in the next few days. These IPOs are expected to get heavily oversubscribed and therefore there will be a huge drain of money from the secondary to the primary market. This is another factor prompting FIIs to sell. Due to big FII selling, markets have turned distinctly weak"
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