Foreign investments into Indian markets through Participatory Notes (P-Notes) rose to Rs 1.57 lakh crore (about $28 billion) in April.
P-Notes enable overseas HNIs, hedge funds and other foreign institutions to invest in Indian markets through registered
Foreign Institutional Investors (FIIs), while saving on time and costs associated with direct registrations.
According to the latest data released by the Securities and Exchange Board of India (Sebi), the cumulative value of P-Note investments in Indian markets (equity, debt and derivatives) was at Rs 1,57,578 crore last month.
It was higher than investments of Rs 1.48 lakh crore
made in March through this route. However, April's figure was way below Rs 1.64 lakh crore seen in February and Rs 1.62 lakh crore in January.
Notably, investments into Indian shares through P-Notes was at Rs 1.77 lakh crore in November and Rs 1.75 lakh crore in October on government's policy reform measures and initiatives to address tax-related issues.
Besides, the value of P-Notes issued with derivatives as underlying, was at Rs 1.11 lakh crore at April-end.
The
quantum of FIIs investments through P-Notes increased to 11.32 per cent in April, from 11.07 per cent in March.
Till a few year-ago, the P-Notes used to account for more than 50 per cent of total FII investments, but their share has fallen after Sebi tightened disclosure and other regulations for such investments.
P-Notes have been accounting for mostly 15-20 per cent of total FII holdings in India since 2009; it used to be much higher, 25-40 per cent, in 2008. It was as high as over 50 per cent at the peak of Indian stock market bull run during a few months in 2007.
FIIs, the key drivers of Indian markets, pumped in Rs 5,414 crore (around $1 billion) in the Indian stock market in April, the lowest in 16-months, amid political and economic worries.
Additionally, FIIs also infused Rs 5,334 crore ($792 million) in the debt market last month.
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