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Will Indian market do well with out foreign institutional investors (FIIs)?

Created by : Ashim Chowdhury, Associate, ICICI Securities  | 09 27 2008 08:33:18 +0000
Industry : Investment BankingFunctional Area : Strategy Execution(Strategy & Execution)
Keywords : Trading SENSEX INDIAN Stock Market Investing INDIAN Market SEBI FII Foreign Institutional Investor FIIS Domestic Institutional Investor DII
Activity:  465 views;  last activity : 07 06 2010 20:18:09 +0000
FII flows don't have a great impact on Indian present market. The large inflows are often cited by politicians and media as proof that India is a success story and that global investors are flocking in their hordes. It should be kept in mind that the so-called `global investor' can be very fickle. He goes where he perceives profits.FII would be the first to flee with the profits.Can Indians really go alone without foreign investors in the market?
  
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Top Argument
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as we know recently about Dubai recession , impact of resession is very less on india this due to only only due to highest investment  in domestic sector .if more investment is made after DUBAI definitely we'll face loss like japan.china
By sarita kar, MBA student, IMIS bhubaneswar  12 05 2009 18:45:03 +0000
 
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I agree to Darshil that the FII have helped the markets plunge from 2k to 20k, but its the virtue of FII that it came from 20k to 8k..

I believe that the Indian markets survive without the FII but it is impossibe as there are very less Domestic Institutional Investors.

The dream of Indian markets can only coem true if LIC, Pension Funds off load massive funds into the stock markets, the markets will be more stabilised and someone to stand against the massive funds of FII's
By Japan Shah, H.O.D, Oxford School of Management  06 08 2009 16:18:01 +0000
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Yes, now the correct valuation of the stocks will happen and small investors will be entering the markets. The amount that the small investor can put into the markets will be in multiples of fii investments
By Mallikarjuna Gupta Bhogavalli, Sr. Product Manager, Oracle India Pvt Ltd  | 09 29 2008 08:38:28 +0000
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I will agree DIIs (domestic institutional investors) can help balance the market, many analysts are openly worrying whether domestic investors can keep ensuring money flows into the Indian equity market if the FII pull-out continues. And there is the larger question as to whether a sharply slowing Indian economy will sustain the kind of profits that, in turn, help fuel Indian stock valuations and justify DIIs putting more money into Indian equities.
By Ashim Chowdhury, Associate, ICICI Securities  | 09 27 2008 08:33:18 +0000
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I am in agreement with japan shah sir. Our economy and rupee exchange rate depend heavily on FII.  And the domestic institutional investors are no bet. Though we can think of pension funds and the  like investing hevily in stocks, the high risk associated with stocks make it practically difficult. I think we still depend heavily on FII.


By Padmanabhan R, Articled / Audit assistant, Finance student  | 06 13 2009 10:50:46 +0000
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An important feature of the development of stock market in India in the last 15 years has been the
growing participation of Institutional Investors, both foreign institutional investors and the Indian
mutual funds combined together, the total assets under their management amounts to almost 18%
of the entire market capitalization.

Net Investments from FII has increased from 4.27 crore in 1992 to 70000 crores in 2008. Similarly u can see that the Sensex from mere low 2000 levels in 1992 to 20000 in 2008. This shows the positive correlation with the FII investment in India and the performance of Sensex
By Darshil , CEO/MD/Director, Darshil Cotton Company  | 06 04 2009 08:20:23 +0000
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FII money is certainly needed for the Indian stock markets, Without FII’s one could not have thought about the Sensex reaching 19000. With more FII’s certainly the indices are poised to reach higher levels.To stop volatile in market SEBI should modify regulations to investing and trading procedures so that market and funds will be in stabilized way.so we cannot blame on FII investors.

By Satish Pandey, Sr. Associate, IL&FS Venture Corporation  | 09 27 2008 08:35:54 +0000
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