RBI hikes FPI investment limits in Government Securities
The Dollar Business Bureau The Reserve Bank of India (RBI) on Tuesday increased the investment limits for foreign portfolio investors (FPIs) in central government securities (G-Secs) by Rs.64 billion and in State Development Loans (SDLs) by Rs.58 billion. “The limits for investment by FPIs for the quarter January–March 2018 is increased by Rs.64 billion in Central Government Securities (Central G-Secs) and Rs.58 billion in State Development Loans (SDLs),” RBI said in an announcement (A.P. DIR Series Circular No. 14). “The revised limits are allocated as per the modified framework prescribed in the RBI/2017-18/12 A.P. (Dir Series) Circular No.1 dated July 3, 2017,” it added. The total limit of G-Secs will be Rs.2564 billion, of which Rs.1913 billion for general category FPIs and Rs.651 billion ...
SEBI puts restriction on use of P-Note derivatives
The Dollar Business Bureau Market regulator Securities and Exchange Board of India (SEBI) has banned foreign portfolio investors (FPIs) from issuing the offshore derivative instruments (ODIs) or participatory notes (P-Notes) where underlying is a derivative. Now, the P-Notes or ODIs can only be issued for the hedging purposes, with respect to the held equity shares. In addition, the market regulator has said that the prevailing positions on unhedged P-Notes for derivatives have to be liquidated by December 31, 2020. “The ODI issuing FPIs shall not be allowed to issue ODIs with derivative as underlying, with the exception of those derivative positions that are taken by the ODI-issuing FPI for hedging the equity shares held by it, on a one-to-one basis,” stated a circular issued by ...
Offshore funds, ETFs see $2 bn inflows in Q1 this year
The Dollar Business Bureau Exchange-traded funds (ETFs) and offshore funds in India recorded a net inflow of $2 billion in the first quarter of this year compared to a huge outflow of $1.3 billion in the same period a year-ago. An offshore fund is referred to a collective investment scheme that is not domiciled in the country but primarily invests in its markets. As per a report by Morningstar, offshore funds focused on India witnessed an inflow of $1.46 billion, whereas ETFs registered an inflow of $509 million, making the total at $2 billion. During the quarter of October-December last year, this category had registered a net inflow of $449 million. The category saw net inflows of $196 million during the quarter July-September 2016. However, ...
FPIs net outflow of $3bn termed worst in 8 years
The Dollar Business Bureau The Indian capital market witnessed $3 billion of the so-called “hot money” being taken out by foreign investors in 2016 signifying the worst period for foreign investments in the last eight years. The biggest impact was felt by the debt instruments after being the chosen form of investment for foreign funds in recent years. The equities continued to be a part of the net inflows but could not make up for huge outflows from the bond market. According to experts, India can expect a likely respite from the low foreign investment climate in the second half of 2017. Going by the depositories data, Foreign Portfolio Investors (FPIs) bought stocks to the tune of Rs 20,566 crore in 2016, but sold ...
RBI eases rules for FPIs to transact in securities directly
The Dollar Business Bureau Reserve Bank of India (RBI) has eased rules for foreign portfolio investors (FPIs) for transacting in securities except shares by permitting them to directly trade in such instruments.“With a view to providing flexibility in regard to the manner in which non-convertible debentures/bonds issued by Indian companies can be acquired by FPIs, it has now been decided to allow them to transact in such instruments either directly or in any manner as per the prevalent/approved market practice,” a notification by the RBI reads.SEBI (Securities and Exchange Board of India) registered Foreign Institutional Investors (FIIs), registered FPIs, Qualified Foreign Investors (QFIs) and long-term investors are permitted to buy securities on the basis of repatriation and in accordance with terms and conditions ...
Foreign funds press exit with $2-bn hot money pullout in 2016
PTI Indian capital markets seem to be losing their 'safe haven' status among foreign portfolio investors as they appear headed for nearly USD 2-billion pullout of the so-called 'hot money' 2016, making it the worst period in last eight years in terms of foreign investments.Surprisingly, it is the debt instruments that are taking the biggest hit, after remaining a preferred investment avenue for foreign funds in recent years, even as equities continue to attract net inflows but not enough to compensate the huge outflows from the bond market during the year passing by.Experts believe that any respite from such a sell-off is likely only in the second half of the new year 2017.The net outflow by FPIs in the debt market is ...
Govt bonds attracts bids worth Rs. 9,458 cr from FPIs
The Dollar Business Bureau Government debt securities received bids amounting to Rs.9,458 crore from FPIs (Foreign Portfolio Investors) in an online auction, against the Rs.9,333 crore on offer. National Stock Exchange (NSE) conducted the auction on its 'e-bid' platform between 3:30 pm and 5:30 pm, after closing of the market hours. Out of 55 bids, 51 were declared successful, after closing of the two-hour auction. The quota of debt auction provides foreign investors the right for investment in the debt up to the purchased limit. Till October 13, the overall investment in government debts had touched Rs.1,38,667 crore, which is around 94 percent of the total allowed limit of Rs.1.48 lakh crore. In order to allocate the unutilised debt limits amounting to Rs.9,333 crore, the NSE ...
FPIs withdraw Rs.6k cr from Indian debt markets in Oct
The Dollar Business Bureau Foreign investors have withdrawn around Rs.6,000 crore from the country’s debt markets in the first two weeks of October, after investing a huge amount in the month of September. On the other hand, foreign portfolio investors (FPIs) have invested Rs.180 crore in the Indian stock markets during the given period. Siddhant Jain, Chief Operating Officer (COO), SAS Online said that the recent cut in the repo rate by Reserve Bank of India (RBI) is one of the factors that resulted in the outflow. Due to downward pressure on the yields of bond, debt did not look attractive. In addition, new RBI Governor Urijit Patel's dovish stand and flexibility to further reduce rates if required has supported the outflow, he added. The Reserve Bank, on October 4 in its ...
