3 months ago
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Foreign portfolio investors (FPIs) infused ₹22,615 crore into Indian equities, marking the highest monthly inflow successful 17 months, driven by the interim India-U.S. commercialized deal, correction successful home marketplace valuations and robust third-quarter firm earnings.
The latest buying follows 3 consecutive months of dense selling. FPIs pulled retired ₹35,962 crore successful January, ₹22,611 crore successful December and ₹3,765 crore successful November, according to information from the depositories.
Overall, FPIs person withdrawn a nett ₹1.66 lakh crore ($18.9 billion) from Indian equities successful 2025, making it 1 of the worst periods for overseas flows. The outflows were triggered by volatile currency movements, planetary commercialized tensions, concerns implicit imaginable US tariffs and stretched equity valuations.
According to the data, FPIs invested ₹22,615 crore successful February. This was the highest monthly inflow since September 2024, erstwhile they had invested ₹57,724 crore.
The inflow was driven by secondary marketplace buying, signalling renewed overseas assurance post-2025 outflows, said Vinit Bolinjkar, Head of Research astatine Ventura.
Javed Khan, Senior Fundamental Analyst astatine Angel One Ltd, said 3 cardinal catalysts supported the inflow. These included India-U.S. commercialized agreements and corrections successful India's marketplace valuation. Additionally, Q3 FY26 net grew 14.7%, suggesting assurance successful the maturation narrative.
Echoing akin views, Varun Gupta, CEO of Groww Mutual Fund, attributed the renewed inflows to improving net momentum, moderation successful valuations from highest levels and aboriginal signs of easing commercialized uncertainty, with India concluding aggregate FTAs, including those with the EU and UK.
Sectorally, FPIs were assertive buyers successful financials and superior goods, portion continuing to pare vulnerability to the IT sector. The conception saw outflows of ₹10,956 crore amid concerns implicit AI-led disruption.
"FPIs had sold heavy successful IT stocks owed to the Anthropic daze and continued weakness successful the segment. However, they turned buyers successful fiscal services and superior goods," said V.K. Vijayakumar, Chief Investment Strategist astatine Geojit Investments.
Looking ahead, Mr. Khan said March flows are expected to stay positive. Q4 net volition find whether 15% net maturation successful FY27 is achievable, portion rupee stableness beneath ₹91 to the dollar provides comfortableness connected returns.
Vijayakumar said FPIs are apt to follow a wait-and-watch attack earlier expanding vulnerability to emerging markets. However, improving GDP maturation prospects and a steadfast firm net outlook for FY27 bode good for medium-term flows.
Meanwhile, the ongoing struggle successful the Middle East has triggered a risk-on sentiment successful fiscal markets. Its interaction connected crude prices and currency movements remains a cardinal monitorable, helium added.
