Foreign investors remained bullish on Indian equities in August. extending inflows since July. FPIs had turned buyers for the first time in July after nine straight months of massive net outflows, which started in October last year.
According to the CDSL data, the total Assets Under Custody (AUC) of foreign investors in the month of August stood at around ₹52 lakh crore. This figure includes inflows in debt and hybrid schemes. Just in Indian equities, the AUC stands at ₹47.94 lakh crore.
Data shows that, in August, the US contributed almost 40 percent to the total AUC of foreign investors. AUC of the United States stood at ₹18.72 lakh crore in August followed by Mauritius at ₹4.94 lakh crore and Singapore at ₹3.5 lakh crore. AUCs for Luxembourg, the UK, and Ireland also stood between ₹2 lakh crore to ₹3.4 lakh crore.
The AUC of total foreign investment in Indian equities rose ₹2.7 lakh crore in August on an MoM basis. It stood at ₹45.22 lakh crore in July 2022. In the previous month as well, the US was at the top of the list with an AUC of ₹17.74 lakh crore, 39 percent of the total AUC.
In August, foreign investors pumped in a little over ₹51,200 crore into the Indian markets, making it the highest inflow in 20 months, amid improving risk sentiment and stabilisation in oil prices. Before this, the highest investment made by foreign investors since December 2020, when they had infused a net ₹62,016 crore in equities.
The inflows in August come after a net investment of nearly ₹5,000 crore by FPIs in July following a 9-month hiatus. Between October 2021 till June 2022, they withdrew ₹2.46 lakh crore from the Indian equity markets.
They have pumped ₹12,000 crore into the Indian equity market so far in September on hopes that global central banks, particularly the US Fed, may go slow on rate hikes as inflation starts to cool off.