FPI Exodus: ₹70,398 Crore Pulled from Indian Stocks in October, Financials and Auto Hit Hard

Foreign Portfolio Investors (FPIs) have been selling large amounts of Indian stocks throughout October, shifting their investments to cheaper markets like China. By October 17, FPIs had pulled out a significant ₹70,398 crore (around $8.38 billion) from the Indian stock market, following strong inflows of ₹57,724 crore in the previous month.

Nifty 50 Drops Sharply

This heavy selling pressure has caused the Nifty 50 index to drop by over 1,700 points since its peak at the end of September. The change in FPI behavior is due to several factors, including China’s recent economic stimulus measures aimed at boosting its slowing economy. Additionally, Indian stocks have become expensive, and geopolitical tensions in the Middle East have further sped up the FPI outflows.

Key Sectors Affected by FPI Selling

FPIs sold the most in the Financial Services, Oil & Gas, and Automobile sectors during the first half of October.

Financial Services Hit the Hardest

The Financial Services sector was the most affected, with FPIs selling ₹23,283 crore worth of stocks from October 1 to 15. This is a big shift from September when FPIs invested ₹27,200 crore in the sector.

Oil & Gas Sector Sees Big Outflows

The Oil, Gas & Consumable Fuels sector also saw heavy FPI selling, with ₹12,371 crore pulled out during the first half of October.

Auto Sector Faces Continued Selling

The Automobile and Auto Components sector saw FPIs sell ₹8,131 crore worth of stocks, continuing a negative trend that started in August and September.

Other Sectors Facing FPI Outflows

• FMCG Sector: FPIs sold ₹6,818 crore worth of stocks.
• Consumer Services Sector: ₹4,633 crore in outflows.
• IT Sector: FPIs sold ₹2,727 crore.
• Power Sector: ₹2,678 crore in outflows.
• Healthcare Sector: ₹2,376 crore in outflows.
• Construction, Telecom, and Construction Materials: FPIs also sold stocks from these sectors, with outflows ranging from ₹1,426 crore to ₹1,723 crore.

FPI Buying Activity

In the first half of October, very few sectors saw FPI buying. The Chemicals sector was the only major one with significant inflows, totaling ₹552 crore. Other sectors, like Metals & Mining and Utilities, saw modest inflows of ₹222 crore and ₹127 crore, respectively.

Conclusion

Overall, FPIs have been selling heavily in October, especially in the Financial Services, Oil & Gas, and Automobile sectors. Despite some buying in Chemicals and Metals, the overall trend remains tilted towards selling.