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July 2020
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Missing Mayor found dead in north Seoul        Heavy rain hits scenic central Japan, more damage in south        Bikru bloodbath mastermind Vikas Dubey nabbed in MP town        NIA to probe gold smuggling case, ex-Consulate woman employee moves HC for anticipatory bail        Kerala reports biggest daily spike of 339 infections,COVID-19 tally crosses 6,500 mark        Holder wins early battle with Stokes as Windies take control        Ganguly announces cancellation of Asia Cup in September        We have asked every state to adopt one sport: Rijiju        Rupee slips 9 paise to 75.02 against USD        ICICI Bank to raise up to Rs 15,000 crore to bolster capital base        Trump threatens to cut federal aid if schools don't reopen        Pak PM urges world community to share info on COVID-19 strategies as tally rises to 239,225        Enhancing global cooperation need of the hour to effectively tackle COVID-19: Prez        Kanpur encounter: 2 policemen held for 'tipping off' gangster Vikas Dubey about police action        CBSE should explain rationale behind dropping certain chapters from curriculum: Sisodia        301 test positive in Kerala,COVID-19 tally crosses 6,000 mark        Dhoni turns 39, wishes pour in from all corners        New era for cricket as England-West Indies series begins        India''s COVID-19 tally, fatality rate per million population lowest in world: Govt        Rahul asks why no mention of Galwan Valley in MEA statement on talks        
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Business News
P-note investment rises to over Rs 60,000 cr till May-end
 
New Delhi, Jun 18 (PTI) Investments through participatory notes (P-notes) in the domestic capital market rose to Rs 60,027 crore till May-end, making it the second consecutive monthly increase.

P-notes are issued by registered foreign portfolio investors (FPIs) to overseas investors who wish to be part of the Indian stock market without registering themselves directly. They, however, need to go through a due diligence process.

According to Sebi data, the value of P-note investments in Indian markets -- equity, debt, hybrid securities and derivatives -- stood at Rs 60,027 crore until May, while the same was at Rs 57,100 crore at the end of April.

The investment level had fallen to an over 15-year-low of Rs 48,006 crore at the end of March.

The figure at March-end was the lowest level of investment since October 2004, when the total value of P-note investments in Indian markets stood at Rs 44,586 crore.

The lower figure in March came amid significant volatility in broader markets on concerns over coronavirus-triggered recession.

Of the total Rs 60,027 crore invested through the route till May, Rs 49,160 crore was invested in equities, Rs 10,106 crore in debt, Rs 159 crore in the derivatives segment and Rs 103 crore in hybrid securities.

Fund inflow through the route stood at Rs 68,862 crore, Rs 67,281 crore and 64,537 crore at the end of February 2020, January 2020 and December 2019, respectively. However, it was at Rs 69,670 crore at November-end last year.

Arjun Mahajan, head of institutional business, at Reliance Securities said the P-note is now not a preferred route for investing in India as Sebi has made registration easier and also desirable for FPIs. However, due to certain taxation laws in India, FPIs still want to explore this route of investing.

Another aspect that may be considered in the current uncertain environment is that certain FPI investors, who don't have an FPI licence, and who may not want to invest in India for long term and just invest to either capitalise on easy liquidity and also attractive valuations (when compared to historic peaks), may prefer P-note route as it gives them the option to invest for however long they want, make their target returns and go away, he added.

Earlier in September, Securities and Exchange Board of India (Sebi) simplified know-your-customer (KYC) requirements and registration process for FPIs. Besides, the regulator broad-based the classification of such investors.

Meanwhile, FPIs withdrew a net sum of Rs 7,355 crore from the capital markets (equity and debt) in May. This was much lower than a pull out of Rs 14,858 crore by them in the preceding month.


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