MUMBAI, July 11: The net investment by foreign institutional investors (FIIs) in the Indian stock markets have reached a record level during the month of June since April 1996. The total transactions by the FIIs in the Indian markets also crossed the $ 1 billion mark in the previous month.

According to the latest figures made available by the Securities and Exchange Board of India (SEBI), net FII investment in June 1997 were $ 362.9 million. Upto July 9, 1997, net FII investments for the month of July 1997 were $ 57.7 million.

In addition to this, 100 per cent debt funds registered with SEBI had invested $ 106.6 million. According to Sebi, the cumulative net investment by FIIs upto July 9, 1997 including investment by 100 per cent debt funds is $ 8,484.5 million.

Net FII investments in 1997 have been increasing since March. Monthly net FII investment was $ 189.8 million in March 1997, $ 148.5 million in April 1997 and $ 199.6 million in May 1997 and $ 362.9 million in June.

According to the SEBI, the noteworthy factor about the net FII investmet in June 1997 is the level of gross purchases and sales, which were at their highest monthly level since FIIs began investing. Gross purchases by FIIs stood at Rs 2,583 crore and gross sales at Rs 1,282.5 crore. Thus, total gross transactions by FIIs in June were just over US $ 1 billions.

About the FII role in Indian stocks, SEBI said ``it has been the experience over the past four years that FII investments in Indian securities has been driven by relative valuations of Indian markets with respect to other emerging and developed markets and expectations of growth in corporate profits, industrial production and in the overall economy. As these perceptions have varied and evolved, FII investment in our markets has also varied. The levels of FII investment in the recent months are consistent with this trend.''

Daily purchases by FIIs in the same period were more than Rs 150 crore on five days while daily sales were high on two days. On June 16, 1997, daily purchases at Rs 249 crore by FIIs were at their monthly highest, but sales at Rs 206.1 crore were also high, resulting in net investment of Rs 42.9 crore $ 12 million).

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.