Business Desk
12 October 2025, 12:52 PM IST
FPI selling slows in October as India’s growth outlook and earnings projections improve. Analysts expect buying momentum to continue.
Representational image. | Photo: AI generated
New Delhi: The intensity of foreign portfolio investor (FPI) selling in Indian markets slowed sharply in October, analysts said on Sunday, signalling a possible shift in investor sentiment.
“One, the valuation differentials between India and other markets, which were high earlier, have come down significantly in recent weeks following the rally in other markets and consolidation in the Indian market. “Two, the growth and earnings prospects for India have been revised upward by market experts. The GST cuts and the low interest regime are expected to boost India Inc’s earnings in FY27, which the market will soon start discounting,” said Dr VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Foreign investors turned net buyers in the cash segment during the last four trading sessions of the week ending October 10, purchasing equities worth ₹3,289 crore.
However, global sentiment has turned cautious again following renewed tensions between the US and China. The trade war has reignited after US President Donald Trump threatened to impose a 100 per cent tariff on Chinese imports and restrict critical US exports to China. Analysts said future FPI flows will depend largely on how the situation evolves.
Siddhartha Khemka, Head of Research (Wealth Management) at Motilal Oswal Financial Services, noted that the Nifty50 gained 104 points to close at 25,285 last Friday, aided by easing geopolitical tensions after Israel and Hamas agreed to the first stage of a ceasefire plan, and by signs of progress in an India–US trade deal.
“Renewed FPI buying also boosted sentiment. Additionally, India and the UK announced multiple collaborations across sectors, including education, critical minerals, climate change, and defence,” Khemka added.
With valuations becoming more attractive and corporate earnings expected to strengthen in FY27, analysts believe FPI outflows are likely to moderate in the near term.
In September, FPIs had sold shares worth ₹27,163 crore through exchanges, though they continued long-term investments through the primary market, purchasing equities worth ₹3,278 crore.
On the macroeconomic front, investors will now turn their focus to India’s retail inflation data for September, scheduled to be released on Monday.
IANS
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