The Indian capital market post liberalisation underwent various reforms and deregulations which heavily attracted foreign investments particularly the portfolio investments. The Indian primary market on the other hand is an integral part of the capital market which infuses fresh capital into the system by mechanisms like Initial Public Offering (IPO). This article thus attempts to make an understanding of few major causes like IPO size and market capitalisation as major forces in attracting foreign institutional investors (FII) inflows into the Indian primary market and thereby analysing the role of FIIs into capital formation.
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