After 3 months, foreign portfolio investors turn net buyers

MUMBAI: In October, foreign portfolio investors (FPIs) turned net buyers of stocks in the Indian market again, and infused a little over Rs 14,600 crore. Between July and Sept this year, FPIs had net sold stocks worth a little over Rs 76,600 crore, data from NSDL showed.

The net buying by foreign funds was because of resilient corporate earnings of Indian companies, a series of rate cuts by the US Federal Reserve in the last few months, and hopes of a US-India trade deal that would address the ongoing tariff-related issues, among others. The net purchase of domestic equities came despite the rupee hitting a new all-time low against the dollar, market players said.

Official data showed that in Sept, foreign funds had net sold stocks worth Rs 23,885 crore, Rs 34,993 crore in Aug and Rs 17,741 crore in July.

Oct's Rs 14,610-crore net inflow was the second highest monthly net buying figure for 2025, behind a Rs 19,860-crore inflow in May and just ahead of June figure of Rs 14,590 crore.

According to Shrikant Chouhan, head equity research, Kotak Securities, globally investors were again taking a positive view of equities in Oct because of a new trade truce between China and the US, the US Fed cutting interest rates, and Alphabet, Meta, and Microsoft raising their capex guidance. However, going forward, the flows could be volatile, Chouhan said.

VK Vijayakumar, chief investment strategist, Geojit Investments, was also cautious about the sustainability of FPI flows through stocks. "The relatively higher valuations in India may prompt FPIs to sell again. Whether FPIs will buy or sell will depend on the trajectory of India's corporate sector's earnings growth," Vijayakumar said. "There are clear signs of earnings recovery now. If the brisk demand conditions in the market sustains, earnings will improve, which, in turn, will make valuations fair."