REITs become net sellers in capital markets in October so far, withdraw net amount of Rs 1,472 cr
A trend reversal was seen in the debt segment in October compared to the big buys of the previous two months, when REITs invested Rs 13,363 crore in September and Rs 14,376.2 crore in August. So far in October they have withdrawn 1,698 crore from Rs.
“This turnaround in debt investing is due to the INR depreciation in October,†said VK Vijayakumar, chief investment strategist at Geojit Financial Services.
In stocks, REITs have invested Rs 226 crore on a net basis.
“REITs that were sellers of bank stocks in the first half of September became buyers in the second half. But they’ve been selling software services throughout September. the segment, in the future, â€he added.
Himanshu Srivastava, Associate Director – Manager Research, Morningstar India said as markets hit all-time highs and valuations skyrocket, REIT would have preferred to sit on the sidelines, take a wait-and-see approach and continue to record profits along the way.
“REITs continue to worry about dwindling easy liquidity after the US Fed hinted at an earlier-than-expected rate hike. Concerns such as the rise in oil prices and US bond yields and the challenges of the Chinese economy radar, thus holding them in suspense and preventing them from investing substantially in the Indian markets, â€he added.
On the future of REIT flows, Shrikant Chouhan, head of equity research (retail), Kotak Securities said that Brent crude oil prices are trading at high levels and a sharp increase in the price of energy can be a major obstacle for the stock markets.
In addition, any rate hikes by the US Federal Reserve in the near future would also be a key headwind for overall flows in emerging markets. Therefore, REIT flows are expected to remain volatile in emerging markets.