FPI return to India may be tactical, not structural yet: HSBC MF’s Venugopal Manghat
Foreign investors are cautiously returning to Indian equities, but a durable FPI reallocation remains unconfirmed. HSBC Mutual Fund’s Venugopal Manghat highlights improving earnings, stable domestic demand and manufacturing growth, while stressing valuation discipline. Sustained foreign inflows will depend on earnings delivery, rupee stability, global liquidity, and India’s relative…
HSBC Mutual Fund's chief investment officer-equity, Venugopal Manghat, suggests that the recent influx of foreign portfolio investors (FPI) into Indian equities may be a tactical move rather than a structural shift. Manghat emphasizes that global liquidity, interest rates, currency stability, and India's valuation against other emerging markets will continue to influence FPI flows.
While India's valuation premium has softened from its 2024 highs, he believes investors should await stronger earnings growth and a more stable rupee before considering the recent return of foreign inflows as a lasting trend. Manghat also notes that the earnings recovery in India is showing early signs of improvement, with Nifty profit growth accelerating and FY27–28 earnings expected to grow in the mid-teens.
However, he cautions that valuations are not inexpensive across the board, and a bottom-up approach that focuses on individual businesses with strong earnings visibility and return potential is necessary.
Brief written by urgent.news from The Economic Times - Top News's own syndicated text. Machine-written — may contain errors; check the original before relying on it.
