FPIs Pour ₹16,621 Crore Into Indian Equities In August First Half, Foreign Inflows Extend After ₹20,200 Crore July Buying
· Free Press Journal
Mumbai: Foreign Portfolio Investors (FPIs) continued to return to Indian equities in August, investing Rs 16,621 crore in the first fortnight, helped by better valuations, steady corporate earnings and expectations of softer US interest rates.
The latest buying follows an investment of Rs 20,200 crore in July, signalling a reversal after four straight months of heavy foreign selling, according to CDSL data.
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Selling Streak Reverses
Before July’s recovery, FPIs had pulled out Rs 49,340 crore in June, Rs 32,963 crore in May, Rs 60,847 crore in April and Rs 1.17 lakh crore in March. They had invested Rs 22,615 crore in February.
Despite the recent improvement, foreign investors remain net sellers in Indian equities during 2026. Their withdrawals stand at around Rs 2.4 lakh crore so far, already higher than the Rs 1.66 lakh crore outflow recorded during all of 2025.
Market experts said improving valuations compared with other markets, resilient company earnings, expectations of US interest rate cuts, softer crude oil prices and lower currency volatility have encouraged foreign investors to return.
Manish Bhandari, CEO and Portfolio Manager at Vallum Capital, said diversification away from crowded Korea-Taiwan artificial intelligence trades was also supporting India.
Foreign Investors Step Up India Buying, Stronger GDP & Earnings Outlook Could Sustain FPI InflowsSelective Buying
Vedant Gupte, Co-Founder and CEO of Trackk, said the August inflows indicate that the earlier selling was driven more by global economic factors than India-specific concerns.
He said expectations of lower US rates, softer crude prices and a more stable rupee have reduced key concerns for overseas investors.
Foreign buying, however, is becoming selective. Consumer durables and healthcare are among the sectors attracting interest.
July data also showed strong FPI purchases in Consumer Services, Healthcare, Consumer Durables, Metals & Mining and IT, while several other sectors recorded net selling.
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Future flows are likely to depend on US Treasury yields, the dollar index, crude oil prices and corporate earnings.
Investors will also watch developments around US-Iran tensions and their impact on crude prices.
FPIs also invested Rs 972 crore in debt through the Fully Accessible Route and Rs 69 crore through the general route during the first half of August.