Foreign Portfolio Investors (FPIs) infuse Rs. 19,860 crore (US$ 2.32 billion) in May on strong domestic fundamentals, global cues

Foreign investors continued to show strong confidence in India’s equity market, injecting Rs. 19,860 crore (US$ 2.32 billion) in May 2025, buoyed by favourable global economic indicators and robust domestic fundamentals. This follows a net investment of Rs. 4,223 crore (US$ 494.20 million) in April, according to data from depositories. Despite significant outflows earlier in the year, Rs. 3,973 crore (US$ 464.95 million) in March, Rs. 34,574 crore (US$ 4.05 billion) in February, and a substantial Rs. 78,027 crore (US$ 9.13 billion) in January—the latest inflows have helped narrow the total outflow for 2025 to Rs. 92,491 crore (US$ 10.82 billion). Chief Investment Strategist at Geojit Investments, Mr. V K Vijayakumar, noted that while foreign portfolio investors (FPIs) are expected to maintain their investments in India, some profit booking could occur at elevated valuation levels.
Associate Director – Manager Research at Morningstar Investment, Mr. Himanshu Srivastava, attributed the May FPI inflows to several factors, including easing United States (US) inflation and expectations of Federal Reserve interest rate cuts, which have made emerging markets like India more attractive. Domestically, India’s strong Gross Domestic Product (GDP) growth, healthy corporate earnings, and ongoing policy reforms have bolstered investor sentiment. Mr. V K Vijayakumar further highlighted the impact of global macroeconomic trends such as a declining US dollar, slowing US and Chinese economies, and India’s high GDP growth combined with falling inflation and interest rates. In terms of sectors, FPIs showed increased buying interest in autos, components, telecom, and financials during the first half of May. Beyond equities, FPIs also invested Rs. 19,615 crore (US$ 2.30 billion) in debt general limit and Rs. 1,899 crore (US$ 222.23 million) in debt voluntary retention schemes in the period under review.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.