Foreign Investors Turn Net Buyers of Indian Equities This Year

Overseas investors bought a net 6.9 billion rupees ($153.6 million) of Indian stocks yesterday, becoming net buyers of the equities for the third time this year, the nation’s market regulator said.

Foreigners purchased 24.7 billion rupees of shares and sold 17.8 billion rupees, the Securities and Exchange Board of India said today. They sold 2.67 billion rupees of bonds, reducing their debt purchases this year to 134 billion rupees.

Foreign funds bought a record 1.33 trillion rupees of shares in 2010, helping fuel a 17 percent rally in the Bombay Stock Exchange’s Sensitive Index, the best performer among the world’s 10 biggest equity markets last year. The Sensex has fallen 9.8 percent this year.

The previous record was in 2009 when flows reached 834.2 billion rupees, sparking the biggest advance in 18 years. Funds pulled out a record 530 billion rupees from stocks in 2008, setting off the worst annual slump. Foreign funds have placed 4.472 trillion rupees in equities and 920.7 billion rupees in bonds since they were allowed into the country in 1993.

The regulator provides data on shares bought and sold by large investors, including trades in the primary and secondary markets, with a delay of at least a day.

To contact the reporter on this story: Paresh Jatakia in Mumbai at pareshj@bloomberg.net

To contact the editor responsible for this story: Arijit Ghosh at aghosh@bloomberg.net

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