Positive Mood Among Foreign Portfolio Investors (FPIs)
Tuhin Kanta Pandey, the Chairman of the Securities and Exchange Board of India (SEBI), has shared a highly optimistic outlook regarding Foreign Portfolio Investors (FPIs) and their confidence in the Indian stock market. Pandey emphasized that FPIs have a strong faith in India’s growth story, as evidenced by the recent trend of increased investments in Indian equities. This sentiment comes at a time when there has been a notable trend reversal with FPIs becoming net buyers of Indian stocks after several months of selling.
Highlights:
FPI sentiment towards India remains very positive.
FPIs have shown confidence in India’s growth story, with a trend reversal seen in recent days.
The SEBI Chairman met with numerous foreign investors in the US to discuss India’s prospects.
SEBI Chairman’s Insights Following U.S. Visit
Pandey’s comments come after his recent trip to the United States, where he attended a global market regulators conference under the International Organization of Securities Commissions (IOSCO). During his visit, he met with several FPIs in cities like Washington D.C., New York, and Boston. According to Pandey, the mood was overwhelmingly positive in these meetings, especially under the Financial Stability Engagement Group during discussions under the IMF-IOSCO track.
Pandey noted that there was strong enthusiasm for India’s prospects in the meetings, reflecting a growing confidence in the country’s economic future and investment opportunities. His positive sentiment is consistent with the trend reversal observed in recent months, with FPIs now returning to the Indian market as net buyers.
Highlights:
Pandey attended a global market regulators conference in the U.S. under IOSCO.
Met with FPI investors in Washington D.C., New York, and Boston.
The mood was overwhelmingly positive, with strong support for India’s growth story.
FPI Turnaround: From Net Sellers to Net Buyers
A key highlight of the recent market behavior is the trend reversal among FPIs. After several months of selling, FPIs have turned into net buyers of Indian equities, a significant shift from their previous stance. In April 2025 alone, FPIs have bought equities worth Rs 1,900 crore (approximately $234 million), a sharp contrast to their net selling in the earlier part of the year.
Since April 11, 2025, when the market rally gained momentum, FPIs have been net buyers of Indian stocks worth over Rs 24,000 crore, signaling a renewed interest in the Indian market after a prolonged period of selling. The reversal of trend is seen as a strong indicator of confidence in India’s economic recovery and growth potential.
Highlights:
FPIs turned net buyers of Indian equities in April 2025, buying Rs 1,900 crore worth of shares.
Since April 11, FPIs have bought shares worth Rs 24,000 crore.
This shift contrasts with the net selling trend seen earlier in 2025.
The FPI Sell-Off in Early 2025: A Temporary Setback
Pandey acknowledged the FPI sell-off that took place earlier in 2025, particularly in the first quarter of the year. However, he emphasized that the overall trend remains positive, with FPIs having invested $58 billion across equity and debt in the last five years. This substantial long-term inflow highlights the broader confidence in India’s economy and financial markets, despite short-term volatility.
Pandey explained that the FPI sell-off observed in late 2024 and early 2025 could be attributed to multiple factors, including market valuations and uncertainty surrounding the new U.S. administration. He also pointed to the ongoing China vs India comparison, with many investors reassessing their positions in emerging markets, including India. However, the recent reversal of this trend suggests that the factors leading to the sell-off were temporary, and investor sentiment has now improved significantly.
Highlights:
$58 billion in foreign investment has come into India over the last five years.
The sell-off in early 2025 was attributed to market valuation concerns, uncertainty about the U.S. administration, and the China vs India market comparison.
The recent trend reversal reflects improving investor confidence in India.
FPI Confidence in India’s Future Growth
Pandey remains optimistic about India’s prospects, citing the positive feedback from his interactions with global investors. With the Indian market showing strong resilience, particularly amidst global economic uncertainties, the SEBI Chairman believes that FPIs are likely to continue their net buying activity in the coming months. The reversal of the FPI trend marks a significant shift in investor sentiment, which could have a positive impact on the Indian equity markets.
As foreign investors express growing confidence in India’s economic growth, the SEBI Chairman reiterated the importance of maintaining a favorable investment climate and continued focus on financial stability and market transparency.
Highlights:
SEBI Chairman optimistic about the future of FPI investments in India.
The positive sentiment indicates continued net buying activity in the future.
India’s resilient market performance has boosted global investor confidence.
