Throughout the identical interval, they withdrew roughly $50 billion from the secondary market, leading to a mixed internet outflow of $28 billion.
The divergence marks a major change from the previous eight years, between November 2016 and September 2024, when overseas traders invested $51 billion in main markets and $56 billion in secondary markets.
The brokerage famous that overseas investor curiosity has more and more targeting primary-market alternatives whereas secondary-market participation stays weak.
Why are FIIs shopping for new shares however promoting listed shares?
One attainable rationalization is that overseas traders have gotten extra selective about valuations and development alternatives.
Major-market investments, together with IPOs and different contemporary share issuances, enable institutional traders to guage particular person companies, their development prospects and provide valuations.
MUST READ:Â Rs 53,739 crore FPI inflows in Nov, highest since Sept 2024; why and what’s subsequent
Nevertheless, primary-market inflows don’t essentially imply traders take into account IPOs cheaper than established listed firms.
The report doesn’t determine particular IPOs or set up whether or not valuations, institutional placements or sector preferences prompted this divergence.
In the meantime, promoting in listed equities might mirror broader portfolio changes, international threat aversion and issues about Indian fairness valuations.
Which sectors are witnessing the most important FII promoting?
The promoting strain has been notably pronounced in monetary companies, vehicles and FMCG.
Throughout calendar 12 months 2026 by October, FIIs withdrew $30.4 billion from Indian equities.
Monetary companies accounted for $13.2 billion in outflows, adopted by vehicles at $4.9 billion and FMCG at $4.5 billion.
In distinction, companies attracted $1.4 billion, metals $1.3 billion and capital items $1.1 billion.
These sectoral variations counsel overseas traders usually are not uniformly bearish on Indian companies.
Is overseas investor sentiment lastly enhancing?
Motilal Oswal highlighted a notable turnaround throughout October.
Though FIIs withdrew $2.2 billion through the month, they invested $2.8 billion within the second half after withdrawing $5 billion within the first half.
Home institutional traders concurrently invested $6.3 billion, extending their shopping for streak to 39 consecutive months.
The brokerage believes enhancing company earnings, comparatively engaging valuations and sturdy home liquidity may encourage renewed overseas participation.
DO READ:Â Gold falls 21% globally however solely 15% in India: How the rupee protected traders
What ought to retail traders perceive?
Sturdy institutional demand for an IPO shouldn’t routinely be interpreted as proof of engaging valuations or assured itemizing good points.
Traders ought to look at profitability, monetary disclosures, pricing and long-term development prospects earlier than subscribing.
Equally, persistent FII promoting doesn’t essentially make listed shares unattractive.
ALSO READ:Â LTCG tax elimination for FPIs! Will Sensex, Nifty get a carry after $64 billion outflows?
Disclaimer: Enterprise Immediately supplies inventory market information for informational functions solely and shouldn’t be construed as funding recommendation. Readers are inspired to seek the advice of with a certified monetary advisor earlier than making any funding selections.
