Foreign Portfolio Investors (FPI) heavily dumped financial services stocks in the first half of March, amid heightened global geopolitical tensions and a weakening rupee driven by rising crude oil prices in the backdrop of the escalating US-Iran conflict.
According to data from the National Securities Depository Limited (NSDL), FPIs offloaded financial services stocks worth ₹31,831 crore between March 1 and 15. This sharp reversal follows net buying of ₹8,418 crore in the sector in February.
Overall, outflows from the Indian stock market stood at ₹52,704 crore during the first fortnight of March 2025. The selling pressure intensified further, with total outflows reaching ₹77,214 crore as of March 18 — marking the highest monthly outflow since January 2025, as per NSDL data.
However, FPIs had turned net buyers in the Indian stock market in February, snapping a three-month streak of outflows. The domestic equities saw worth ₹22,615 crore in February.
Sectors witnessing highest FPI outflows
The financial services sector recorded the highest FPI outflows, exceeding ₹31,000 crore during March 1–15. Consequently, total in the sector declined by 11% to ₹20,71,813 crore as on March 15, down from ₹23,26,577 crore at the end of February.
This was followed by the Automobile and Auto Components sector which witnessed FPI selling worth ₹4,807 during the period.
Apart from these, Telecommunication recorded worth ₹3,856 crore, followed by Construction at ₹2,975 crore, Oil, Gas & Consumable Fuels at ₹2,932 crore, Healthcare at ₹2,436 crore, Fast Moving Consumer Goods (FMCG) at ₹2,403 crore, and Realty at ₹2,133 crore.
Additionally, consumer durables, construction materials, and information technology (IT) sectors each recorded FPI outflows exceeding ₹1,000 crore during the period. Notably, the IT sector had already witnessed substantial in February.
Sectors attracting FPI inflows
On the other hand, FPI inflows were primarily concentrated in the capital goods sector, which attracted investments worth ₹3,897 crore between March 1 and 15.
Metals & Mining sectors saw buying worth ₹876 crore, followed by Consumer Services at ₹531 crore and Power at ₹602 crore. The chemicals sector witnessed of ₹225 crore during the period.
Overall, the data indicates a clear sectoral shift in FPI positioning, with investors reducing exposure to rate-sensitive and consumption-linked sectors while selectively allocating capital to industrial and cyclical segments.