Foreign Investors Inject ₹38,000 Crore Into Indian Stocks On Strong Growth Outlook

Mumbai: Foreign Portfolio Investors (FPIs) have demonstrated robust confidence in the Indian market this month, injecting over Rs 38,000 crore into equities. This surge follows a trend reversal from January’s outflow of Rs 25,743 crore, with February seeing a modest inflow of Rs 1,539 crore. Year-to-date, FPI investments stand at Rs 13,893 crore in equities and Rs 55,480 crore in the debt market.

Himanshu Srivastava, Associate Director at Morningstar Investment Research India, attributes this heightened activity to improved global economic conditions and optimism regarding India’s macroeconomy. Despite recent market corrections, FPIs have seized attractive buying opportunities.

The influx of FPIs can be attributed to India’s strong GDP growth and expectations of potential policy shifts by the Reserve Bank of India (RBI), possibly leading to anticipated rate cuts in the latter half of fiscal year 2025.

However, FPIs exhibited a cautious stance last week, turning net sellers by $314 million. In addition to equities, FPIs have injected Rs 13,223 crore into the debt market this month alone, driven by India’s bonds inclusion in Bloomberg’s Emerging Market (EM) Local Currency Government Index starting January 31 next year.