New Delhi, Oct 15 (NationPress) Domestic institutional investors (DIIs) have made a historic investment of Rs 6 lakh crore in Indian equities during the calendar year 2025, marking the highest annual influx since the BSE started recording data in 2007.

This robust domestic investment has effectively countered the selling trend initiated by foreign portfolio investors (FPIs) in CY25, who withdrew approximately $23.3 billion, equivalent to over Rs 2 lakh crore, from Indian equities, as per data from the National Securities Depository Limited (NSDL).

The net DII investment, which includes contributions from banks, development financial institutions (DFIs), insurance companies, pension schemes, and mutual funds, exceeded the Rs 5.26 lakh crore invested in CY24, indicating a growing domestic endorsement for equities.

Conversely, FPIs invested about Rs 49,590 crore in domestic equities through primary market routes and other avenues in CY25.

Experts predict that this momentum will continue, largely driven by consistent Systematic Investment Plan (SIP) flows, which remain strong even amid market downturns. They noted that unless a global crisis leads to a 30–40 percent market correction, DII flows are expected to exceed 2025 levels in CY26.

Moreover, analysts suggest that if tariff issues are resolved, global investors might eventually catch up.

DIIs have historically capitalized on purchasing opportunities during sell-offs, especially since the Lehman crisis when Foreign Institutional Investors (FIIs) began panicking.

Market analysts have also pointed out that domestic institutional investors have raised their stakes in the BFSI, capital goods, healthcare, and automotive sectors.

DII inflows have been instrumental in absorbing the selling pressure from FIIs, substantial promoter share offloads, and profit-taking by private equity firms. While strong domestic inflows have not led to widespread market gains, indices across various market capitalizations have displayed flat to negative performance over the previous year.

Nevertheless, in terms of year-to-date returns, the Sensex and Nifty indices have risen by 5.11 percent and 6.56 percent, respectively, while the BSE Smallcap index has seen a decline of 5.6 percent and the BSE Midcap index is down 1.6 percent in CY25.