Foreign and Domestic Investors Become Net Buyers in March, Infusing Over $5 Billion into Indian Equities
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Synopsis
In March 2025, both foreign institutional investors and domestic institutional investors became net buyers in the Indian equity market, collectively injecting over $5 billion. The shift in FII sentiment saw them transition from net sellers to aggressive buyers, leading to significant sectoral investments, particularly in BFSI, telecom, and metals.
Key Takeaways
- FIIs invested $975 million while DIIs contributed $4.3 billion in March.
- FII shareholding increased to 16.8% from 15.9% in February.
- Banking, telecom, and metals attracted the most foreign inflows.
- BFSI sector saw the largest inflow of $1.7 billion.
- IT services sector share declined due to geopolitical uncertainties.
Mumbai, April 10 (NationPress) Foreign and domestic investors displayed remarkable confidence in the Indian equity market during March 2025, as both foreign institutional investors (FIIs) and domestic institutional investors (DIIs) were net buyers, according to a recent report.
FIIs contributed $975 million, while DIIs made even greater net purchases totaling $4.3 billion throughout the month, as highlighted in the JM Financial Securities’ report.
The month marked a significant shift in FII sentiment. Initially, in the first half of March, specifically until the 19th, FIIs were net sellers, but they reversed course to become aggressive buyers in the latter half, investing $3.6 billion into Indian equities.
This change elevated FII shareholding in Indian stocks to 16.8% in March, up from 15.9% in February, the report noted.
The sectors that drew the highest foreign investments included banking, financial and insurance services (BFSI), telecom, and metals.
BFSI topped the list with $1.7 billion in FII inflows, followed by telecom with $360 million and metals at $219 million.
Other sectors that attracted investor interest, though to a lesser extent, included realty, chemicals, media, and pharmaceuticals.
The report also emphasized that FIIs maintained solid exposure in essential sectors. Together, BFSI, IT, Oil & Gas, Auto, and Pharma represented nearly 60% of total FII holdings in Indian equities.
The proportion of BFSI in FII Assets Under Custody (AUC) in India increased to 31.2% in March from 30.8% in February, while Pharma's share slightly rose to 6.9% from 6.8%.
Conversely, the IT services sector, the second-largest for FII holdings, saw its share decline to 9% from 9.9% in the previous month, impacted by ongoing geopolitical uncertainties.
Auto's share decreased to 6.7% from 7%, while Oil & Gas remained stable, as per the report.
