FPIs Pump ₹34,500 Cr into Indian Stocks in September, Turning Market Around After August Dip

Foreign portfolio investors (FPIs) made strong net inflows into the Indian stock market in September, turning their overall secondary market investments for the year positive. By the end of September, FPIs had invested a total of $4,140.3 million (₹34,554 crore) in Indian equities, compared to a net outflow of $1,417 million (₹11,998 crore) at the end of August. This information comes from data provided by NSDL.

In September alone, FPIs invested $6,890.5 million in Indian stocks, including both primary and secondary market investments. This marked their highest monthly investment since December 2023, when they had invested $7,939 million.

Even on the last day of September, FPIs added $43 million to the market, despite the selling pressure that caused the main stock indexes to drop by about 1.5%.

FPIs Favor Secondary Market in September

In September, FPIs invested $5,557.3 million in the secondary market, far surpassing their investment of $1,322.2 million in the primary market. This trend was different from the first nine months of 2024, where FPIs had shown more interest in IPOs and Qualified Institutional Buyer (QIB) investments. During that period, FPIs invested a total of $12,054 million in equities, with $7,914 million going through the primary market.

Domestic Mutual Funds Show Slower Growth

Unlike FPIs, domestic mutual funds slowed down their equity investments in September, with a net investment of ₹26,072 crore, compared to ₹31,685 crore in August. However, on September 27, domestic funds recorded their second-highest single-day investment of the year, putting ₹7,786.1 crore into equities. For the first nine months of 2024, domestic mutual funds invested ₹2,73,535 crore in equities, compared to ₹1,12,571 crore during the same period last year.

What to Expect in the Coming Months

Looking ahead, FPI flows into the secondary market are expected to remain volatile due to growing geopolitical tensions and rising interest in Chinese equities. However, in the primary market, FPI investments could remain strong as several large IPOs are anticipated, including those from Hyundai Motor India, Swiggy, NTPC Green, and Afcons Infrastructure, which are expected to raise over ₹60,000 crore in the coming weeks.