Despite continued selling by Foreign Institutional Investors (FIIs) and a decline in their Assets Under Custody (AUC) in equities amid market corrections, other investor groups have suffered even greater portfolio losses in percentage terms.
Hindu Undivided Families (HUFs) experienced the sharpest drop, with their equity holdings plummeting over 87% since the market peak in September. Brokers and partnership firms also saw significant declines of around 85% and 27%, respectively. Similarly, Foreign Currency Convertible Bond (FCCB) holders and financial institutions witnessed their portfolios shrink by over 26.5% and 23%, respectively.
While FIIs recorded a nearly 20% decline in AUC, their absolute losses remain high, though their percentage erosion ranks sixth compared to other groups. FIIs have sold over ₹2.5 lakh crore in Indian markets since September due to concerns over high valuations, economic slowdown, and global trade tensions. This has led to a 4.5% year-to-date drop in benchmark indices Sensex and Nifty, while mid- and small-cap indices fell over 14% and 17%, respectively.
Other investor categories, including insurance firms, banks, depository receipts, trusts, and mutual funds, saw their equity AUC decline by 11-16%. Corporates, foreign depositories, local pension funds, portfolio managers, and alternate investment funds faced a milder impact, with equity erosion between 2-10%.
Interestingly, despite the overall market downturn, Foreign Direct Investment (FDI) portfolios in equities increased by 3.3%, while NRI and foreign venture capital investments grew by 2.6% and 1.1%, respectively.
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