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Time of India
07-07-2025
- Business
- Time of India
Analysts see sustained FPI inflows, await clarity on tariffs and global rate cuts
Live Events Agencies (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel Mumbai: The automobile sector witnessed the highest foreign inflows worth ₹5,020 crore in the second half of June, after witnessing outflows worth over ₹15,700 crore between January and May."The fall in interest rates and pick up in rural demand has made the auto sector attractive, especially since the valuation has become very comfortable," said Divam Sharma, fund manager, Green Portfolio investors are reallocating their portfolio in line with valuation comfort, said May, the sector saw marginal inflows worth ₹101 crore. Overseas investors bought shares worth ₹27,920 crore across 11 sectors in the last 15 days of June, according to data from & gas and financials saw foreign investment worth over ₹4,000 crore each in the second half of the month, after witnessing inflows worth ₹1,199 crore and ₹4,685 crore, respectively, in the first half of the crude oil prices and the infusion of liquidity by the RBI through interest rate cuts, respectively, stoked investor sentiment in these investors infused funds worth ₹3,620 crore in telecommunication and ₹2,879 crore in the Information Technology (IT) sectors in the last 15 days of June. The IT sector has witnessed aggressive foreign selling worth ₹31,766 crore between January and May."The impact of tariffs is likely to be limited on services, given the bilateral talks between India and US which supported the inflows into the IT sector," said U R Bhat, co-founder & director, said that the inflationary pressure in the US is not likely to be as pronounced as anticipated earlier which further alleviates stress on business prospects as the US Fed is expected to cut interest rates in the second half of the investors sold shares worth ₹7,929 crore across 12 sectors in the second half of the month. These investors divested shares worth ₹3,191 crore and ₹3,022 crore in the power and capital goods sector, respectively."Early and stronger than expected, monsoon rains lowered electricity consumption, particularly in agriculture and rural areas and foreign capital rotated from power to higher yielding sectors like auto, oil & and gas, and financials that were in strong demand," said Sudeep Shah, SBI Caps. Shah said that while the infra spending remains, concerns over project delays and execution risks have tempered enthusiasm in parts of the capital goods sectors."Since capital goods had seen significant gains, FIIs are taking away profits to reallocate to growth sectors."Analysts expect incremental foreign inflows to persist, with the quantum of flows likely to be moderate to aggressive."Further foreign inflows are likely to be determined by the tariff outcomes which seems to be favourable for India so far," said Bhat. "If the negotiations favour India, then robust foreign inflows are expected."Sharma said that the de-dollarisation trend is expected to continue and induce aggressive foreign inflows into India, given that the negatives are already factored into the prices."The outlook remains moderately positive, but inflows are likely to be sector and valuation driven rather than broad based," said Shah. "The quantum may be moderate, but incremental FII inflows are expected in the near term if global rate cuts materialise and domestic earnings deliver."
Time of India
23-04-2025
- Business
- Time of India
IT bore brunt of FPI pullout in April amid tariff turmoil
"Bank Nifty has performed well owing to the short squeeze in banking stocks, and since it is a domestic-facing sector, tariffs are not likely to have a major impact on the sector," he said. Overseas investors offloaded shares in the financial services and capital goods sectors worth ₹4,501 crore and ₹3,019 crore, respectively. While capital goods had seen outflows last month, financial services had received foreign inflows worth over ₹14,000 crore. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Mumbai: The information technology (IT) sector saw the highest selling from overseas investors between April 1 and 15 as concerns over the impact of an expected US downturn heightened risk-off sentiment. Foreigners sold IT shares worth ₹13,828 crore in this period, after pulling ₹8,451 crore out of sector in March. In 2024, foreign investors pumped over ₹14,000 crore into the sector."A significant chunk of orders in the IT sector are driven by the US, and since the outlook on those orders is uncertain given the concerns of a slowdown in the US, the sector has seen highest outflows in the first half of April," said Divam Sharma, fund manager, Green Portfolio investors offloaded shares in the financial services and capital goods sectors worth ₹4,501 crore and ₹3,019 crore, respectively. While capital goods had seen outflows last month, financial services had received foreign inflows worth over ₹14,000 crore."Most sectors are anticipated to be impacted by the confusion on Trump tariffs but sectors with premium valuations are more prone to higher foreign outflows," said UR Bhat, director, the first half of April, foreigners sold Indian equities worth ₹37,108 crore across 17 sectors after infusing ₹31,877 crore in the second half of March, according to NSDL. Sharma said foreign sell-off in financial services has tempered after the recent outflows because of comfortable valuations."Bank Nifty has performed well owing to the short squeeze in banking stocks, and since it is a domestic-facing sector, tariffs are not likely to have a major impact on the sector," he and mining, oil and gas, automobiles and construction sectors also saw foreign outflows over ₹2,000 crore each. They bought shares worth ₹3,181 crore across 6 ix sectors in first half of April, with elecommunications receiving the highest inflows of ₹2,137 crore. Foreign investors have pumped over ₹17,600 crore into stocks in previous 5 trading sessions, but they remain net sellers in April of ₹16,670 crore.
