India Sees Record FII Investment

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Feb. 29 – Foreign Institutional Investors (FIIs) invested Rs. 7,598 crore net into India’s equity markets on February 24, 2012 – making it the largest ever fund flow on a single day in rupee terms.

Information released by the Securities and Exchange Board of India (SEBI) showed that the FII investments seen on February 24 were considerably higher than the previous high of Rs. 6,906 crore registered on November 4, 2010. On that same day in 2012, the Sensex closed at 20,893 and a day later closed at an all-time high of 21,004.

In dollar terms, last Friday’s fund flows stood at US$1.548 million, as against US$1.558 million on November 4, 2010.

The net inflow for the 2012 calendar year now stands at Rs. 34,713 crore and the well-built FII inflows over the past two months have lifted the markets enormously – resulting in the Sensex rising by 14.7 percent so far in 2012. It closed at 17,731 on February 28.

The total investment in the first two months is also the most ever for the beginning of a calendar year. Inflows in February are at Rs. 24,335 crore net, which is the third-highest net monthly investment by FIIs ever. It is on the road to cross the highest inflow of Rs. 28,562 crore received in October 2010.

FII investment is not only restricted to equities, but is also strong on the debt front.

The debt investment stood at Rs. 23,521 in the first two months of 2012 and the combined investment (equity and debt) now is at Rs. 58,234 crore as of February 27, 2012.

Dezan Shira & Associates is a boutique professional services firm providing foreign direct investment business advisory, tax, accounting, payroll and due diligence services for multinational clients in India. For more information, please contact india@dezshira.com, visit www.dezshira.com, or download the firm’s brochure here.

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