FPIs offload Rs 45,608 cr in March so far

New Delhi: Continuing their selling spree for the 6th straight month, overseas investors have pulled out a net Rs45,608 crore from the Indian markets in March so far.

Foreign portfolio investors (FPIs) fear that India would be impacted more by commodity price hikes, particularly in crude oil, since India is a major importer, said VK Vijayakumar, chief investment strategist at Geojit Financial Services. As per depository's data, FPIs pulled out Rs41,168 crore from equities, Rs4,431 crore from the debt segment and Rs9 crore from hybrid instruments, taking the total net outflow between March 2-11 to Rs45,608 crore. This is the sixth consecutive month of FPI outflows from the Indian markets. The selling is mainly confined to financials and IT since these segments constitute the bulk of assets under the custody of FPIs, Vijayakumar noted.

"An important takeaway from FPI selling is that it is not impacting all segments. For instance, FPIs sold IT stocks worth Rs10,984 crore in February, but in March IT is one of the best performing sectors," he added.

Nimish Shah, chief investment officer, Listed Investments, Waterfield Advisors, said: "The dollar has been gaining strength since August-September 2021 and the interest rates in the US have moved up now. The geopolitical crisis has also moved market flows and shifted sentiment from risk-on to risk-off, resulting in withdrawals from most emerging market economies." Shrikant Chouhan, head (equity research-retail), Kotak Securities, said: "Other than Thailand, all other emerging markets have witnessed outflows till date in March. "Taiwan, South Korea, Indonesia and Philippines witnessed FPI outflows to the tune of $7,089 million, $2,665 million, $426 million and $26 million, respectively. On the other hand Thailand witnessed inflows of $102 million," he said. As per Shah, sectors like IT, pharma, banks and auto ancillary would do well going forward.