July5 , 2022

Which sectors are witnessing FPI selling in June? Here’s a hint

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NEW DELHI: The value of Indian shares that foreign investors own has fallen about Rs 2.61 lakh crore or 6.3 per cent to Rs 41.51 lakh crore during the fortnight ended June 15, down from Rs 44.12 lakh crore in the fortnight ended May 31, in line with weakness in the broader market.

The month has seen FPIs selling over Rs 40,000 crore worth of domestic shares so far, with the first half of the month alone witnessing Rs 24,949 crore outflows.

Data available with NSDL showed that FPI selling intensified in sectors such as financial services, consumer durables, FMCG, metals & mining, among others. Oil & gas and chemicals sectors continued to see FPI buying but the power sector that saw FPI buying in the previous fortnight witnessed selling during the fortnight ended June 15.

Selling in the financial services sector has continued with FPIs pulling out a net Rs 8,050 crore worth of shares in the fortnight ended June 15. This was higher than Rs 3,894 crore outflows in the previous fortnight ending May 31.

Overall, FPIs’ exposure to financial services sector stocks has fallen by Rs 1.08 lakh crore to Rs 12.85 lakh crore from Rs 13.94 lakh crore in the previous fortnight, down 8.4 per cent.

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IT, another sector where FPIs have huge exposure, saw their holding value fall 7 per cent to Rs 5.09 lakh crore from Rs 5.45 lakh crore. FPI outflows for this sector stood at Rs 3,702 crore in the latest fortnight, which was less than Rs 10,506 crore outflows in the previous fortnight.

FMCG was another sector, which saw a fall in FPI exposure in value terms. FPIs held Rs 2.58 lakh crore worth of FMCG stocks against Rs 2.78 lakh crore in the previous fortnight. FPIs sold Rs 1,523 crore worth of FMCG shares in the first fortnight of June, which was higher than Rs 1,093 crore outflows in the previous fortnight.

The exposure of FPIs to consumer durables (down Rs 13,083 crore), Power (down Rs 12,323 crore), metals (down Rs 10,608 crore) and oil & gas (Rs 10,240 crore) also declined in value terms.

In the case of consumer durables, FPIs sold shares worth Rs 2,577 crore compared with an outflow of Rs 1,336 crore in the previous fortnight.

FPIs sold Rs 1,956 crore worth of power stocks after investing Rs 899 crore into the sector the previous fortnight. In the metals & mining sector, outflows intensified to Rs 1,573 crore in the fortnight ended June.

Some buying was observed in the oil & gas sector. FPIs bought Rs 847 crore worth of oil & gas shares in the fortnight ended May 15 compared with an inflow of Rs 155 crore in the previous fortnight.

Auto, healthcare services, consumer services, construction material services and chemicals sectors also saw a fall in FPI exposure in value terms. In the auto sector, FPI selling stood at Rs 1,459 crore against Rs 188 crore outflows for May 16-31.

In the healthcare sector, FPIs were net sellers of Rs 860 crore in June’s first fortnight against net buyers of Rs 133 crore in the second fortnight of May.

In the consumer services sector, selling reduced to Rs 321 crore from Rs 690 crore in the previous fortnight. In construction, selling intensified to Rs 1,662 crore from Rs 752 crore, while in the chemicals sector, inflows were seen at Rs 135 crore but at a reduced pace.

(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)



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