The Securities and Exchange Board of India (SEBI)  launched a dedicated Foreign Portfolio Investor (FPI) outreach cell as part of the Alternative Investment Fund and Foreign Portfolio Investors Department (AFD). 

The markets regulator said in a statement that this outreach cell will focus on direct engagement with FPIs, and support them in accessing the Indian securities market seamlessly. Key responsibilities of the outreach cell will include providing guidance to prospective FPIs during the pre-application stage, including assistance with documentation and compliance processes.

These will also include offering support during the onboarding phase, and resolving any operational challenges that may arise during the registration process or thereafter. FPIs have been bullish on the Indian stock market despite global geo-political uncertainties.

The month of September witnessed the second highest inflows in 2024 so far, the last one being in March. Data from NSDL showed that till September 17, FPIs pumped net $3,682 million in Indian equities, higher than the net monthly flows in six out of eight previous months in the current calendar year.

The primary factors that make emerging markets like India a sweet spot, are balanced fiscal deficits, rate cut impacts on the Indian currency, strong valuations, and RBI’s approach to keep inflation under control without a rate cut.

The ferocity of the FII buying can be noticed in the massive Rs 14,064 crore buying in the cash market on September 20. The trigger for this aggressive buying by FIIs was the 50 bp rate cut by the US Fed, marking the beginning of a rate cutting cycle. According to market experts, the trend of FII buying is likely to continue in the coming days. Banking stocks have turned attractive after news of reduction in the credit-deposit gap.