India's stocks luring foreign traders back

Block trades attract overseas investors

- SCOTT MURDOCH ANKUR BANERJEE

Foreign investors are starting to head back into Indian stocks after a major exodus, attracted by $5.5 billion worth of big-ticket block trades in May and lifting hopes of a revival in the nation's equities market.

The block trades were well bought by overseas investors, according to bankers.

They marked the highest monthly total in almost a year and a huge jump from only $220 million in April.

"We actually saw interest coming in from a fairly diverse set of investors who were missing in action in the last six months," said Abhinav Bharti, head of JPMorgan's India equity capital market business.

"They had gone out of India, said India is just too expensive, we don't want to buy anything right now. I think we could start seeing them coming back."

Block trades often precede a recovery in IPOs, and May's robust offerings come amid a strong performance for Indian stocks.