HomeIndiaInvestment in participating notes reaches a 4-month high of Rs 95,911 cr...

Investment in participating notes reaches a 4-month high of Rs 95,911 cr in April

Investment in Indian capital markets through participating notes has been on an upward trend over the past two months, with the number reaching Rs 95,911 crore at the end of April, mainly driven by the country’s strong economic growth.

This was the highest level since November 2022, when investment through the route was Rs 96,292 crore.

Participating notes (P-notes) are issued by registered Foreign Portfolio Investors (FPIs) for foreign investors who want to be a part of the Indian stock market without registering directly. However, they must go through a due diligence process.

According to Sebi data, the value of investments in P notes in Indian markets (equities, debt and hybrid securities) stood at Rs 95,911 crore at the end of April compared to Rs 88,600 crore at the end of March .

Furthermore, this was the second consecutive monthly increase in the level of investment. Investment through P notes was Rs 88,398 crore at the end of February and Rs 91,469 crore at the end of January.

The growth of P notes is generally aligned with the trend of FPI flows, when there is a global risk to the environment, investment in this way increases and vice versa.

Shrey Jain, founder and CEO of Sasonline, said that one of the main drivers of P-note investment growth is India’s strong economic growth, which positions the country as an attractive destination for FPI investments.

“Another factor contributing to the growth of investment in P notes is the rapid development of infrastructure, including transportation, logistics, energy and digital infrastructure. These initiatives not only address critical gaps, but also provide investment opportunities for FPIs in sectors such as construction, engineering and renewable energy,” he said.

According to him, the increase in investments in P-notes can be attributed to several other factors, including a substantial consumer base, significant market potential, and demographic advantage, among others.

Of the total Rs 95,911 crore invested through this route up to April this year, Rs 86,226 crore was invested in equity, Rs 9,586 crore in debt and Rs 100 crore in hybrid securities.

Furthermore, the assets in the custody of the FPIs increased to Rs 50.85 lakh crore in April from Rs 48.71 crore in the previous month.

Meanwhile, FPIs invested Rs 11,631 crore in Indian stocks in April and Rs 806 crore in the debt market.

(Only the headline and image in this report may have been modified by Business Standard staff; all other content is auto-generated from a syndicated feed.)

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