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Foreign investors’ stake in NSE 500 companies at a three-year low, after Taiwan the highest withdrawal from India

A US report has revealed that the ownership of foreign institutional investors (FIIs) in NSE 500 companies has slipped to a three-year low in March 2022.

For the past few months, foreign investors have been heavily selling shares of Indian companies. Now a US report has revealed that the ownership of Foreign Institutional Investors (FIIs) in NSE 500 companies has slipped to a three-year low in March 2022. According to a report by Bank of America’s multinational investment banking division BofA Securities, FIIs own only 19.5 per cent in the NSE 500. However, BofA believes that in the coming times, if the investment increases, there may be a jump in the ownership level again.

According to Amish Shah, Head (India Research) BofA Securities, Nifty may remain at the level of 17 thousand till the end of this year, but investment in financial, industrial, some auto companies, utilities and healthcare can be given preference. In March 2022, the Nifty had strengthened by about 4 per cent and as of now, the Nifty 50 closed at 17,171.95, down 1.27 per cent on Friday (April 22).

After Taiwan, India has the highest evacuation

  • As of March, the assets under management of Foreign Portfolio Investors (FPIs) stood at $ 61.9 thousand crore (Rs 4733.10 crore). In this, the maximum allocation of 16.2 percent was in Energy, 14.8 percent in IT and 4 percent in Communication, while the biggest fall was in Financial. In this year 2022, foreign investors made the highest withdrawal from India after Taiwan, while the maximum investment of $ 1250 million (Rs 95.6 thousand crore) was done in Brazil.
  • According to the report, March last month saw the highest withdrawal after March 2020. Due to geopolitical risk, ever-increasing inflation rate, supply problems and rising commodity prices, investors withdrew $ 5400 million (Rs 41.3 thousand crore) from the Indian market last month. In March 2020, foreign investors had withdrawn $ 840 million (Rs 6.42 lakh crore).

increased investment here

  • However, according to the report, Emerging Market Funds increased investment in India instead of China in the last one year. Till March this year, their allocation in India stood at 19 per cent compared to 13.3 per cent in January 2021, while in China it came down to 34.6 per cent as compared to 42.2 per cent.
  • Talking about domestic institutional investors (DIIs), the investment crossed $ 500 million (Rs 38.2 thousand crore) for the second consecutive month in March. Investments of DIIs in March 2022 increased by 19 percent to a record level of $ 600 million (Rs 45.9 thousand crore) on a monthly basis. This year, DIIs invested $ 14,600 million (Rs 1.12 lakh crore).

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