BofA: Strong Foreign Inflows into India Expected to Continue

According to BofA Global Research, the strong momentum in foreign inflows into Indian equity markets is expected to continue further. The bank bases this outlook on a combination of improving profitability, more attractive valuations, and light positioning. According to the institution's analysis, the recovery in corporate profitability is among the key factors supporting foreign investors' interest in the Indian market. In addition, the relative cheapening of equity valuations creates room for inflows to continue. BofA notes that investor positions remaining at light levels also indicate additional buying potential. The combination of these three factors paints a picture suggesting that the revival in foreign capital flows may not end in the short term. This assessment is noteworthy for the trajectory of foreign interest in Indian markets. The bank states that current conditions allow for continued inflows. Not investment advice.