Foreign portfolio investors (FPIs) continue to take risk off the table and have now sold more than $1 billion worth of shares in May so far. On Wednesday, foreign investors sold shares worth $103 million, provisional data on exchanges showed. The Sensex, at the present levels of 34,663.11, trades at a price-earnings multiple of over 17.82 times one-year estimated forward earnings.
FPIs sold Indian equities worth close to $0.94 billion in April, after buying stocks worth $2.02 billion in March. The FPIs bought $246.1 million worth of equities in 2018 so far. Market Participants said the fall in rupee, rise in crude oil prices and global risk factors have led to the selling by foreign portfolio investors.
“The currency factor and with oil prices where it is the macros are not working so good for India. I think a combination of these could have made FPIs risk averse to India in the shorter term,” said a market participant on the condition of anonymity. Commenting on outlook for FPIs, he said “All the stability factors India had like low oil prices, and stable rupee are no longer there. In that respect, India is not seen as a haven anymore, and valuations are also pretty rich.”
(With FE inputs)