In a strong show of confidence, foreign institutional investors (FIIs) infused more than ₹38,000 crore into Indian equities during the second half of April 2025. The sharp inflow signals positive sentiment towards India’s growth trajectory and investment potential, with financial services emerging as the top sectoral choice.
Financial services attracted a massive ₹22,910 crore — accounting for more than 60% of the total FII inflow.
This sector continues to remain a magnet for foreign capital, driven by consistent performance, sector reforms, and expectations of robust credit growth.
Following closely, the capital goods sector made a dramatic comeback, securing ₹2,944 crore in inflows. This is particularly notable as the sector had earlier witnessed net outflows of ₹3,019 crore in the first half of April. The turnaround reflects renewed investor optimism in India’s infrastructure and manufacturing push.
Capital goods saw a reversal from outflows to significant inflows, signaling improved investor sentiment.
Other sectors that witnessed strong FII interest included oil & gas and FMCG (Fast-Moving Consumer Goods). Oil and gas stocks saw inflows worth ₹2,401 crore, while FMCG stocks followed closely with ₹2,330 crore. These traditionally stable sectors may be benefiting from global commodity trends and domestic consumption strength.
Outflows Persist in IT, Auto, and Metals
Despite the overall bullish sentiment, FIIs continued to exit from select sectors. The IT sector remained under heavy pressure, witnessing outflows worth ₹1,385 crore in the second half of April. This follows a steep ₹13,828 crore sell-off in the first half of the month, indicating sustained caution due to global tech slowdown and margin concerns.
The IT sector saw consistent FII selling, with over ₹15,000 crore in outflows for the full month.
Other sectors that saw FII outflows included automobiles (₹645 crore), metal and mining (₹645 crore and ₹574 crore, respectively), construction (₹425 crore), and real estate (₹353 crore). These exits suggest selective profit booking and sectoral rotation by investors.
Key Takeaways:
FIIs invested ₹38,000+ crore in Indian equities in the second half of April.
Financial services dominated, attracting ₹22,910 crore.
Capital goods and telecom saw renewed interest.
IT, auto, and metal sectors faced continued selling pressure.
With foreign institutional investors shifting their focus towards financials, capital goods, and defensive sectors, the Indian market is witnessing dynamic sectoral movements. Investors and analysts will be closely watching how these trends evolve as we step further into FY25.
