FPIs pull out ₹13,740 crore this week despite IPO optimism

Equity witnessed the heaviest selling with FPIs withdrawing ₹12,568.66 crore through stock exchanges and primary markets combined during the week.
| Photo Credit:
JASON LEE

Foreign portfolio investors (FPIs) remained net sellers in Indian markets this week, withdrawing ₹13,740.43 crore across four trading sessions from November 3 to November 7, 2025, according to data from National Securities Depository Limited (NSDL).

The selling pressure was most pronounced on Monday when FPIs pulled out ₹6,422.49 crore, followed by ₹3,754 crore on Friday. Thursday saw marginal net inflows of ₹20.14 crore, while Tuesday witnessed outflows of ₹1,583.52 crore. Markets remained closed on Wednesday for a holiday.

“While October witnessed net FII buying of ₹3,902 crores, November has started with FIIs turning sellers on every trading day, so far,” said Dr V K Vijayakumar, Chief Investment Strategist, Geojit Investments Limited. “The net FII sell figure through exchanges in November up to 8th, stood at ₹13,367 crore. This takes the total FII sell figure for 2025, so far, to a massive ₹2,07,568 crore.”

Equity witnessed the heaviest selling with FPIs withdrawing ₹12,568.66 crore through stock exchanges and primary markets combined during the week. Monday alone saw equity outflows of ₹7,586.75 crore, followed by ₹2,723.56 crore on Friday, ₹1,932.18 crore on Tuesday, and ₹326.17 crore on Thursday.

However, the primary market showed resilience with FPIs investing ₹798.67 crore through IPOs and other routes. Thursday saw primary market investments of ₹444.26 crore, while Friday recorded ₹329.15 crore, signaling renewed confidence in new listings despite secondary market volatility.

“FIIs, particularly the hedge funds, are selling in India and buying in other markets which are driven by AI trade,” Dr. Vijayakumar explained. “US, China, South Korea and Taiwan are regarded as AI winners while India is widely regarded as an AI loser. This perception is hugely influencing the FPI action in the ongoing global rally driven by AI trade.”

In the debt segment, FPIs showed mixed behavior. Under the Debt-FAR category, foreign investors remained net buyers, investing ₹1,003.81 crore for the week. The Debt-VRR segment saw positive inflows of ₹1,416.67 crore, while the general debt limit category witnessed outflows of ₹1,857.59 crore.

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Ross Maxwell, Global Strategy Lead at VT Markets, said, “FPIs are likely seeing opportunities particularly in sectors such as financial services, renewable energy, and consumer tech, to gain early exposure to high quality companies aligned with India’s long-term growth ambitions. At the same time, volatile global bond yields and currency fluctuations have made the secondary markets riskier, prompting investors to deploy capital through IPOs where valuations often appear more reasonable.”

“The surge in FPI participation in IPOs indicates a subtle shift rather than a broader reversal of cautious sentiment,” Maxwell added. “While overall FPI flows into the secondary market remain uneven due to global rate uncertainty and geopolitical risks, primary market inflows show investors are differentiating between short-term volatility and long-term opportunity.”

The rupee weakened marginally during the week, moving from ₹88.7241 per dollar on Monday to ₹88.6026 on Friday, reflecting the sustained FPI selling pressure.

Dr Vijayakumar noted that elevated AI valuations globally could impact future FPI flows. “The problem, however, is that AI valuations have reached elevated levels and further rallies from here run the risk of a bubble burst. This realisation is dawning on investors widely now. This may restrain sustained FII selling in India. If, along with this realisation, India’s earnings growth continues to improve, FIIs are likely to turn buyers. But this may take time.”

The benchmark indices reflected the selling pressure, with Nifty50 declining 0.89 per cent during the week to close at 25,492.30, while BSE Sensex fell 0.86 per cent to settle at 83,216.28.