Foreign Investors Pump In Rs 2,300 Crore In Three Days

New Delhi: After four months of selling frenzy, overseas investors turned net buyers in February and pumped in over Rs 2,300 crore in the capital market over the last three sessions, enthused by clarity on FPI or foreign portfolio investment taxation.

The latest inflow followed a net pullout of Rs 80,310 crore from equity and debt together in the past four months (October-January). Prior to that, FPIs had invested over Rs 20,000 crore in the capital market.

According to depository data, foreign portfolio investors (FPIs) infused a net sum of Rs 1,246 crore in equities during February 1-3 and another Rs 1,098 crore in the debt segment, translating into a total inflow of Rs 2,344 crore.

Finance Minister Arun Jaitley had in his Budget speech proposed that Category I and II FPIs should be exempted from taxation on indirect transfers, which cheered up investors.

"No change in long-term capital gains tax on equities has lightened investors' fears on transaction cost," said Vinod Nair, head of research at Geojit BNP Paribas Financial Services.

Meanwhile, Nikkei Markit India Manufacturing PMI in January rebounded from the demonetisation downturn by increasing to 50.4, from 49.6 in December, amid rising order books, production as well as buying levels and expansion in the sector.