Let us look at some of the highlights of the SEBI prescribed investment limits for FIIs. The purchase of equity shares of each company by a single FPI or an investor group shall be below 10% of the total issued capital of the company.

Aggregated Equity Investment Limit

The individual ceiling of below 10 percent by a single FPI or an investor group is subject to an overall investment ceiling for total FII investment of 24 percent of the total paid-up equity capital of a company (20 percent in the case of public sector banks) The overall ceiling of 24 percent can be raised up to the sectoral limit if the concerned company passes a resolution by its Board of Directors in the General Body Meeting. Exceptions to these limits apply to individual companies and sectors.

Limits in IPO investments

FPIs can invest under the quota reserved for QIB (Qualified Institutional Buyers) in the IPOs within the overall limits for foreign investments as defined in the Equities segment. Non-Resident Indians are mandatorily required to open bank account (NRE/NRO) with designated Bank and Demat Account with an NBFC to hold shares and execute buy/sell orders

Limits on OFS investments

FPIs can bid under the non-retail quota with the overall ceilings as defined under the Equities segment

Non-Resident Indians can bid under the Non-Institutional Investors Category; discount applicable to retail investors will not be extended under this category