P-notes investment drops in Sept but FPIs positive on domestic mkt, say experts

New Delhi: Investments through participatory notes (P-notes) in the Indian capital market dropped to Rs 69,821 crore at September-end but experts believe FPIs continue to be confident about the domestic market.

This marks the first decline in investment through the route since March, data available with the Securities and Exchange Board of India (Sebi) showed.

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 declined to Rs 69,821 crore at September-end after hitting a 10-month high of Rs 74,027 crore at the end of August.

Prior to that, the investment level was at Rs 63,228 crore, Rs 62,138 crore, Rs 60,027 crore and Rs 57,100 crore at the end of July, June, May and April, respectively. The investment level had fallen to an over 15-year-low of Rs 48,006 crore at the end of March amid significant volatility in broader markets on concerns over coronavirus-triggered crisis.

Of the total Rs 69,821 crore invested through the route till September, Rs 59,314 crore was invested in equities, Rs 10,240 crore in debt and Rs 267 crore in hybrid securities.