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, FPI 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 FPI buying 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 FPI investment 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 FPI outflows 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 FPI selling of ₹16,949 crore 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 FPI inflows 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.
