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After a brief return of optimism in October, foreign portfolio investors (FPIs) have once again turned net sellers in Indian equities, withdrawing Rs 12,569 crore so far in November. The renewed selling comes amid weak global cues, profit-taking, and shifting investor sentiment toward markets favoured by the ongoing AI-driven rally. According to data from depositories, the latest withdrawals follow a net inflow of Rs 14,610 crore in October, which had temporarily reversed a three-month streak of heavy outflows. Before that, FPIs had sold Rs 23,885 crore in September, Rs 34,990 crore in August, and Rs 17,700 crore in July, highlighting a sustained period of volatility in foreign investment patterns, states a PTI report. Market analysts say the consistent selling through each trading day of November has contributed to India’s relative underperformance compared to other global indices. AI Rally Diverts Flows Away from India VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, explained that the divergence in global fund flows has been a defining theme in 2025, noted the report. He observed, “A key feature of FPI activity in 2025 has been the divergence in flows, with hedge funds selling in India while buying in markets perceived as beneficiaries of the AI-driven rally, such as the US, China, South Korea, and Taiwan.” He further added, “India is currently being viewed as an AI-underperformer, and that perception is shaping FPI strategy.” However, Vijayakumar pointed out that valuations in AI-linked markets are becoming stretched, which could eventually limit continued outflows from India. “If this realisation strengthens and India’s earnings growth continues to improve, FPIs may gradually turn buyers again,” he said, the report states. Earnings Support May Slow The Outflow Adding to the discussion, Vaqarjaved Khan, Senior Fundamental Analyst at Angel One, noted that FPIs offloaded Rs 12,569 crore worth of Indian shares in the first week of November amid a broader sell-off in Asian technology stocks, claims the report. “Flows could turn positive in select sectors and stocks as the earnings season progresses,” Khan said, noting that India’s Q2 FY26 results have slightly exceeded expectations, particularly among midcap companies. So far in 2025, FPIs have withdrawn over Rs 1.5 lakh crore from Indian equities. In the debt segment, investors pulled out Rs 1,758 crore under the general category but invested Rs 1,416 crore through the voluntary retention route. Get Latest News live on Times Now along with Breaking News and Top Headlines from Business, Companies and around the world.
