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Foreign Portfolio Investment

Why Invest in India?

Demography and Economy

  • Urban Population to grow from 31.1% to 46% by 2030. leading to increase in demand
  • Strong GDP growth rate of 7.6%
  • 5.3 Fixed capital formation growth rate


  • Stable goverment with absolute majority after 30 years
  • Strong and important initives like Jan Dhan. Digital India. Make in India. Start-up India and many more


  • Constitution amended for introduction of Goods and Services Tax (GST) bill on Aug 03, 2016
  • This will replace all other taxes levied by state and central govt. and will boost GDP growth in India

Production and Price

  • 3.1% increase in index of industrial production
  • 4.4% growth in electricity generation

Demonetization Drive

  • The Government Demonetized 14.18 lakh crore approx, of   500 and 1000 notes
  • Drive created to eradicate black money and counterfeit currency
  • High value of funds deposited in the banks will lead to low interest rates and increased demand

External Sector

  • 15.5% decline in imports
  • Strong foreign reserves and current account deficit reduced to 0.3%

Services Offered to FPI

Online Trading in Equities and Derivatives I Distribution Services of IPO and MF I Real Estate Advisory Services I SMC Easy Go: Back Office Support on Mobile I Award Winning Research Desk I Dedicated FPI Support Desk I Depository Services

Type Of Investment Allowed


  • Shares, Debentures and Warrants, Listed or to be listed (both Primary / Secondary)
  • Units of domestic Mutual Fund Schemes, whether listed or not
  • Indian Depository Receipts (IDRs) & Other instruments as permitted from time to time


  • Dated Government Securities
  • Commerical Papers issued by an Indian Company
  • Security Receipts issued by Asset Reconstruction Companies
  • Perpetual Debt instruments and debt capital instruments, as speified by RBI from time to time
  • Infrastructure NCDs and Bonds


  • Equity
  • Interest Rate
  • Currency

Real Estate Funds

  • Alternate Investment Funds
  • Real Estate Investment Trusts
  • Infrastructure Investment Trusts

About SMC

Established in 1990, SMC is a well-diversified financial services company in India offering services across brokerage (across the asset classes of equities (cash and derivatives), commodities and currency), investment banking, wealth management, distribution of third party financial products, research, financing, depository services, insurance broking and clearing services and real estate advisory services to corporate, institutional, high net worth individuals and other retail clients.

Serving over
18 Lac unique clients
add people
Workforce of
3,000 + employees
Presence in 500+ cities in India & abroad
large network of 2,500+ sub-brokers & authorised persons
*As on 31st March 2018

Our Offerings


Trading member of equity, commodity & currency segments of all the leading exchanges

Wealth Management

SEBI registered portfolio manager-providing client specific portfolio & wealth managment services

Investment Baking

Category 1 merchant banker-private equity, M&A, corporate advisory, debt syndication, FCCB, IPO, FPO, right issue etc.


Distribution of mutual funds, IPOs, corporate fixed deposits, GOI bonds and NCDs

Institutional Broking

(Institutional Trading and Advisory Services)

NRI & FPI Services

Providing trading facilities to Non-resident Indians (NRI) & Foreign Portfolio Investors (FPI)

NBFC (Financing)

Provide loans to salaried, self employed, professionals or businessman and capital or commodity market clients

Mortgage Advisory

Providing secured loans, unsecured loans, project funding and SME loans to investors, corporates and propertyowners across the country

Clearing Services

Manage the clearing services for trading members in different segments of various exchanges

Who Is An FPI?

FPI (Foreign Portfolio Investor)?

  • A unified market access route for all portfolio investments in India
  • Proposal by SEBI committee – convergence of all portfolio investment routes, including FII, Sub Account and QFI
  • Simplified entry norms - No registration requirement with SEBI
  • FPIs to register with Designated Depository Participants (DDPs) – AD Bank Custodian – who will be responsible for due diligence
  • FPI is a resident in a country other than India, whose securities market regulator is a signatory to IOSCO's MMOU (Appendix A Signatories) or a signatory to a bilateral MOU with SEBI. In case of a Bank, it should be resident of a country whose central bank is a member of the Bank for International Settlements (BIS).
  • The person should not be resident in a country listed in the public statements issued by FATF (high risk and non-compliant countries) from time to time on -
Jurisdictions having a strategic Anti-Money Laundering / Combating the Financing of Terrorism (AML/CFT) deficiencies to which counter measures apply or
Jurisdictions that have not made sufficient progress in addressing the deficiencies or have not committed to an action plan developed with the FATF to address the deficiencies


  • Is a person not residing in India
  • Is resident of a country meeting FATF requirements
  • Is not a Non Resident Indian (NRI)
  • Is authorized by its MoA & AoA (or equivalent document)
  • Does not have an “opaque” structure (protected / segregated cell company or similar where ultimate beneficial owners are ring-fenced from each another)
  • Is a resident of a country which is a signatory to SEBI MoU/IOSCO’s MoU
  • If a Bank, should be resident of a country whose Central Bank is a member of the Bank for International Settlements
  • Is legally permitted to invest in Securities outside his country
  • Has sufficient experience, good track record, is professionally competent, financially sound, generally good reputation of fairness and integrity


Category I

  • Regulated entities: Banks, AMCs, investment managers/ advisors, portfolio managers
  • Regulated broad based funds such as mutual funds, investment trusts, insurance / reinsurance companies
  • Broad based funds whose investment manager is appropriately regulated
  • University funds, pension funds
  • University related endowments already registered with SEBI

Category II

  • Government and related entities such as foreigncentral banks, government agencies, SWFs, ultilateral organizations etc.

Category III

  • All other investors not eligible in Category I and II. Examples include non-broad based funds, endowments, charitable societies/trust, foundations, corporate, trusts, individuals, family offices, etc.

KYC Document


  • Proof of Identity (Passport mandatory)
  • Proof of Address
  • Bank Proof
  • Bank Letter
  • PAN


  • Constitutive Documents (MoA, Trust Deed, Partnership Deed)
  • Regulatory Affiliation details
  • Bank Letter stating satisfactory relationship (Cat III only)
  • Shareholding details and Ultimate Beneficiaries’ details
  • Senior Management Credentials / Photo
  • Board Resolution stating that entity is allowed to invest
  • Certificate of Incorporation
  • Proof of Address
  • Financials
  • PAN
  • Authorized Signatories details
  • Bank Account details

Registration Flow Process

Obtain Tax

Appoint CPA of your Choice
Submit requisite forms and supporting documents

Register as Foreign Portfolio Investor (FPI)

Appoint DDP and Custodian
Submit Form 'A' and KYC Form along with supporting documents to your Custodian

Open Bank Accounts in India

Choose a Bank of your Choice
Submit requisite forms and supporting documents

Custodian opens Depository Account and Obtains UCC & CP Code from Exchanges

Open Trading Account with Broker

Choose a Broker of Your Choice
Submit requisite forms and supporting documents

Start Investing in India by

Remitting Funds from Overseas Bank Account to the Bank Account opened in India.
Place Orders with Broker

Process and fees - Custody Process

Particulars Category I Category II Category III Indicative Time Frame
1 Particulars
Provide documentation for PAN Registration
Provide documentation for SEBI Registration
8 - 15 Days
3 - 5 Days
2 SEBI Fees Payable in US only Payment for every block of three years NIL US 3,000 US 3,000
3 Registration done, what next?
Open Cash Accounts with a Bank
Open a Custody Account with Custodian
Open a Brokerage Account with Broker
2 - 4 Days
2 - 4 Days
2 - 4 Days
*Participation Condition:subject to investment of upto 10% in the share capital


What is the definition of broad based fund?
Broad based fund is a fund, established or incorporated outside India, which has at least twenty investors, with no investor holding more than forty-nine per cent of the shares or units of the fund: If the fund has an institutional investor who holds more than 49% of the shares or units in the fund, then such institutional investor must itself be a broad based fund for the fund to meet the broad based criteria. For ascertaining the number of investors in a fund, direct investors as well as underlying investors shall be considered. However, only investors of entities which have been set up for the sole purpose of pooling funds and making investments shall be considered for the purpose of determining underlying investors.
What is the status of registration for existing FIIs and sub-accounts?
All existing FIIs and sub accounts can continue to buy, sell or otherwise deal in securities under these regulations till the validity of their existing registration or upon payment of a conversion fee of USD 1,000 to convert from FII / Sub Account to FPI status, whichever is earlier. The application must be made as per Form A as provided in the regulations and must be accompanied by supporting documents, as prescribed by the regulations or by SEBI from time to time
Can a newly incorporated/established fund seeking to register itself as a broad based fund under Category II, but does not satisfy the broad based criteria at the time of making application, be granted registration?
Yes. If the applicant is newly incorporated/ established seeking to register itself as a broad based fund under Category II, but does not satisfy the broad based criteria at the time of making application, the DDP may consider grant of conditional registration, with validity period of 180 days to such applicant if: a) The applicant is an India dedicated fund or undertakes to make investment of at least 5% corpus of the fund in India b) The applicant undertakes to comply with the broad based criteria within 180 days
How does the applicant confirm compliance with the broad base requirement?
For the DDP to assess compliance with the broad based criteria, the FPI must provide details of investors to the DDP who will perform appropriate due-diligence and issue an acknowledgement regarding fulfillment of broad based criteria, if it is satisfied. With this acknowledgement, the conditional registration shall be treated as registration, henceforth. If the FPI fails to satisfy the DDP that it has attained broad based status within 180 days, it shall be reclassified as category III. SEBI has further clarified that if an existing broad based fund registered as Category II FPI, ceases to remain broad based on account of redemption etc., the applicant would be required to attain broad based status within 180 days and the same procedure outlined above will be followed.
While paying the conversion fees of USD 1000, does the FII or sub- account have to submit an application/ documents?
Yes. At the time of payment of conversion fees, existing FIIs and sub-accounts will need to complete Form A as provided in the FPI regulations and enclose applicable documents required for the purpose of conversion to FPI. An applicant, which is an international/ multilateral agency such as World Bank and other institutions, established outside India for providing aid, which have been granted privileges and immunities from payment of tax and duties by the Indian Government are exempted from payment of such fees.
Is it necessary to pay the conversion fee now or can it be paid upon expiry of the FIIs 3 years block?
The payment of conversion fees can be made now or at the time of expiry of FII/Sub Account in the three year block validity, however if the fees are paid at the time of expiry, then the FII will also need to pay the applicable renewal fees over and above the conversion fee. For example, if the FIIs registration is expiring in May 2016, the FII will need to pay USD 1,000 and USD 3,000 (if it falls under Category II) one month prior i.e. April 2016
What does the regulation specify in case of multiple FPIs have common beneficial ownership?
Where multiple FPIs belong to the same investor group, the investment limits of all such FPIs shall be clubbed at the investment limit as applicable to a single FPI. It is expected that the depositories shall be responsible for such monitoring
What is the validity period of FPI registration?
The validity period of the FPI registration is permanent unless suspended or cancelled by SEBI or surrendered by the FPI, however this is subject to payment of the applicable renewal fee during every three year block
Is it necessary for the FPI to appoint a Compliance Officer?
Yes. Every FPI must appoint a compliance officer who will be responsible for monitoring the compliance of the Act, rules and regulations, notifications, guidelines and instructions issued by the designated depository participant or SEBI or the Central Government: In case an FPI is an individual, then the individual will be responsible for the above. The compliance officer is required to immediately and independently report to SEBI and the DDP regarding any non-compliance observed by him/ her
Is there any cap on the maximum shareholding limit by FPI?
Yes. The purchase of equity shares of each company by a single FPI or an investor group must be below 10% of the total issued capital of the company
Can a FPI directly place order with a stock broker?
Yes. Similar to FIIs, an FPI can place order directly with the broker
Can FPI purchase shares of an unlisted company?
No. FPIs are not permitted to purchase shares of an unlisted company. Further, as per the regulations, FPIs can hold, deliver or cause to be delivered securities only in dematerialized form: Provided that any shares held in physical form, before the commencement of the regulations, can be held in physical form, if such shares cannot be dematerialized.
Can FPIs engage in borrowing or lending of funds or securities?
Yes, FPIs are permitted to engage in borrowing or lending in accordance with the Securities Lending and Borrowing program of SEBI.
Is the investment through the FPI route freely repatriable?
Yes. Investment made through the FPI route is freely repatriable, subject to payment of applicable taxes
Can FPIs open more than one depository account?
No. Each FPI will be allowed to open only one depository account for their FPI investments. Further, purchase and sale of all eligible securities must be transacted through that depository account only
Are there any conditions placed on stock market transactions?
Yes, there are certain conditions on placed on stock market transaction of FPIs. Some of the important ones are: • An FPI can transact in the securities only on the basis of taking and giving delivery of securities purchased or sold and no transaction on the stock exchange can be carried forward • The transaction should be only through stock brokers registered by SEBI • FPIs can deliver or cause to be delivered securities only in dematerialized form However, it may be noted that certain types of transactions have been excluded from meeting some of the above conditions. For example, the requirement of broker is relaxed for transactions in Government securities and such other securities falling under the purview of the RBI which shall be carried out in the manner specified by the RBI.

Contact Us


Head Office
SMC Global Securities Ltd.
11/6B, Shanti Chamber
Pusa Road, New Delhi-110005
Phone : 91-11-25754371
Cell no. : +91- 9650988009
Email :nridesk@smcindiaonline.com


2404, 1 Lake Plaza Tower , Cluster T,
Jumeriah Lake Towers ,
PO Box 117210,
Dubai, UAE
Fax: +97145139781
Email :pankaj@smccomex.com


SMC Global Securities Ltd.
Lotus Corporate Park,
A Wing 401 / 402 , 4th Floor ,
Graham Firth Steel Compound,
Off Western Express Highway,
Jay Coach Signal,
Goreagon (East), Mumbai - 400063
Phone: +912226141905