FPIs Invest ₹30,918 Crore In August, Remain Net Buyers For Second Straight Month

Mumbai: Foreign portfolio investors (FPIs) remained net buyers of Indian equities for the second consecutive month, purchasing shares worth Rs 30,918 crore in August up to August 29.

Of the total investment, Rs 18,790 crore came through stock exchanges, while Rs 12,128 crore was routed through the ‘primary market and others’ category.

What Is Driving FPI Inflows?

The return of foreign investors has been supported by a reversal in the chip trade, stability in the rupee and improving corporate earnings growth in India.

Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investments Ltd, said these factors have played an important role in driving overseas flows into Indian equities.

Another significant trend has been the growing preference of FPIs for small- and mid-cap stocks, commonly referred to as SMIDs.

Growth and earnings momentum in these segments remain stronger than in large-cap stocks, and this trend could continue.

Domestic Investors Provide Support

Foreign institutional investor selling pressure on Friday was largely absorbed by domestic institutional investors (DIIs), which purchased shares worth around Rs 5,184 crore.

On a month-to-date basis, FIIs remained marginal net buyers at around ₹454 crore, signalling a shift following several months of sustained foreign selling.

Indian equity markets, however, remained cautious during the week amid concerns over global interest rates, geopolitical uncertainty and volatility linked to the new Closing Auction Session (CAS).

Markets Fall For Third Week

Benchmark indices recovered sharply on Friday as IT stocks gained following positive global technology cues. Despite the rebound, the indices ended lower for a third consecutive week.

The Nifty declined around 0.31 per cent during the week to settle at 24,175.65, while the Sensex slipped nearly 0.36 per cent to 77,264.51.

The introduction of CAS for futures and options stocks also remained in focus after monthly derivatives expiry witnessed sharp closing-auction price movements.

Meanwhile, broader markets showed resilience. Mid-cap and small-cap indices gained during the week, supported by domestic liquidity and stock-specific buying, partly offsetting weakness in benchmark indices and selective foreign selling.