Foreign institutional investors (FIIs) turned net buyers in the second half of June, investing around ₹14,109 crore in equities, bringing momentum back to sectors such as financial services, construction, consumer durables, realty and healthcare, according to data from the National Securities Depository (NSDL).
In comparison, the first fortnight of June had witnessed a net outflow of ₹63,450 crore from Indian equities.
At the end of June, assets under custody by FIIs stood at ₹68.64 trillion in equities. On the back of buying in the second half of the month, the total outflow from equities stood at ₹49,340 crore.
In the second fortnight, a trend reversal was seen in financial services, which recorded net buying of ₹14,634 crore compared with a net outflow of ₹11,263 crore in the first fortnight.
Construction and consumer services followed with net buying of ₹3,484 crore and ₹3,081 crore, respectively, compared with outflows of ₹603 crore and ₹1,852 crore, respectively.
Among other sectors with significant net buying were consumer durables, realty, services and healthcare. However, the metals and mining and power sectors continued to see high outflows, with net selling of ₹4,371 crore and ₹3,743 crore, respectively, in the second half of the month.
“Foreign selling has been the primary factor constraining India’s market performance over the past two years. However, even a transition from aggressive selling to a neutral stance, or merely a moderation in outflows, could provide a significant tailwind for equities, supported by resilient domestic institutional and retail inflows,” noted Motilal Oswal Financial Services in its India Strategy Report.
While selling pressure continued in sectors such as FMCG and IT, the outflows moderated compared with the first half.
