New York: Prime Minister Narendra Modi's visit to the US to boost bilateral ties and deepen economic relations will give a fillip to investment flows from institutional investors into the Indian markets, says a top Indian fund house Reliance Mutual Fund.
"I believe that the investors who have been sitting on the fence and those looking for an emerging market opportunity would now begin putting their money directly into India, while funds from other emerging markets are also likely to be reallocated to our markets," Reliance MF CEO and mutual fund industry body AMFI's Chairman Sundeep Sikka said.
Sikka, who was here to attend India Investment Forum organised by Institutional Investor Forums ahead of Modi's 5-day US visit from September 26-30, said that he saw a huge interest among the investor community here for Indian markets. "At this point of time, we believe that the Prime Minister's visit and the prevailing positivity about India will turn into good flows into Indian markets from institutional investors," Sikka said.
He said: "A lot of people have been looking at India and now we will see actual money also flowing into India. Till now, a lot of money that came into India, came through ETFs (Exchange Traded Funds), but specially the larger investors will now come and start investing through the local players. "We clearly see that the meetings and interactions with these investors clearly show that the returns generated by the mutual fund schemes have been so superior that its clear that coming through ETFs for them in long term will not be a best opportunity."
When asked what could be the quantum of funds that might come into the Indian markets, the Reliance MF chief said it was difficult to put a number, but it will be much more than the current numbers. "We have seen this year about USD 20 billion coming through both debt and equity. I think this trend will surely continue and as the feedback we are getting from the investors, based on that the allocation which was going to other emerging markets, might also start coming to India. "We will see far more coming in than what we have seen during the last year," he added.
When asked what all would attract investors to India, in addition to good returns, Sikka said: "What we are seeing is that for institutional investors, the best thing is that when they see an opportunity, they see an upside. Now, a lot of things are falling in place for India."
