The net investment during the first 24 days of the year is very close to the net investments made by FIIs during the year 1995 at Rs 3853.8 crore. The figure exceeds the net investment of Rs 2595.1 crore made by FIIs during the year 1993.

The gross purchases done by FIIs during the 24 days period were Rs 7,275.7 crore and gross sales were Rs 3,640.1 crore. Their net investment in equities were Rs 3,364.5 crore while net investments in debt were Rs 261.2 crore. During the last four days, net investments by FIIs were Rs 698.6 crore.

Low valuations of stocks, easing of global markets particularly Nasdaq and good cash positions could be stated as the reason for the massive inflow according to some FIIs. HSBC Securities and Capital Markets (India), director and head of research Vasudeo Joshi says, "The parity had come down to the level that stocks seems to be attractive."

According to Jardine Fleming's director and chief investment officer UR Bhat, "FIIs are redeploying the money they have accumulated resulting from past sales done in IT stocks." Says Mr Joshi, "During December, many FIIs had raised cash." According to some FIIs, after the huge inflows cash positions of FIIs would have now come down from 15 per cent to 7 per cent. Expectations that the budget would give big push into infrastructure could have also led to FIIs getting bullish.