Foreign investors actively invest in the Indian market, injecting over 16,600 crore rupees in 15 days

Foreign investors continued active purchases in the Indian stock market, investing 16,621 crore rupees during the first two weeks of August. This inflow of funds marked a sharp change in trend after four consecutive months of intensive selling by Foreign Portfolio Investors (FPIs).

The increased investor interest is attributed to the improvement in relative asset valuation, sustained corporate profitability, and expectations of interest rate cuts in the US.

This August inflow followed investments of 20,200 crore rupees in July. Previously, the situation was the opposite: in June, FPIs withdrew 49,340 crore rupees, in May—32,963 crore rupees, in April—60,847 crore rupees, and in March, a colossal amount of 1.17 trillion rupees was withdrawn. Before this decline, they had invested 22,615 crore rupees in February, according to CDSL data.

Despite the recent buying activity, foreign investors remain net sellers in the Indian market for 2026, withdrawing about 2.4 trillion rupees, which already exceeds the outflow of 1.66 trillion rupees recorded for the entire year 2025.

Market experts explain the recent turnaround as a complex of factors, including attractive valuation compared to other markets, stable company earnings, forecasts for US rate cuts, slowing crude oil prices, and reduced currency volatility.

Manish Bhandari, CEO and Portfolio Manager at Vallum Capital, noted that 'the key drivers are improved relative valuations, sustained corporate profitability, expectations of easing rates in the US, lower currency volatility, and some diversification away from overheated AI deals in Korea and Taiwan. AI has become a magnet for global capital.'

Vedant Ghopte, Co-founder and CEO of the investment platform Trackk, believes that the August inflow indicates that previous sales were more related to global macroeconomic factors than concerns about India. He added that 'expectations of US rate cuts, lower crude oil prices, and rupee stabilization have removed three reasons why foreign investors had to stay away.'

According to Ghopte, FPI purchases are also becoming more selective, as investors show greater interest in sectors related to domestic consumption. He emphasized: 'Consumer goods and healthcare are attracting attention. Foreign investors are supporting the Indian household, not the Indian invoice.'

Sector data for July showed strong purchases in consumer services, healthcare, consumer goods, metals, and mining, although several other sectors recorded net sales.

Nevertheless, future FPI flows are likely to remain sensitive to global signals, particularly US Treasury yields, the dollar index, crude oil prices, and rising corporate earnings forecasts.

Pabitra Mukherji, Vice President of Research at Bajaj Broking, reported that in the coming week, investors will closely monitor crude oil prices and the development of geopolitical tensions between the US and Iran.

Foreign investor interest has also extended to the debt market. During the period under review, FPIs invested 972 crore rupees in debt through the Fully Accessible Route (FAR) and another 69 crore rupees through the general route.

Last week saw significant volatility in the Indian stock market, although both market indices, Sensex and Nifty, ultimately showed growth. Among the thirty most valuable companies in the BSE Sensex index, six incurred substantial losses, while four companies brought significant profits to investors.

Investors made the largest gains from shares of the country's largest bank, SBI, which generated an impressive 64,000 rupees in just five trading days. Despite strong fluctuations, the BSE Sensex and NSE Nifty managed to end the week in positive territory.

Six out of the ten most expensive companies in the Sensex index were in the red, leading to a loss of 1.23 lakh crore rupees for investors during the week. These companies include Bharti Airtel, HDFC Bank, ICICI Bank, Bajaj Finance, LIC, and HUL. Meanwhile, four companies—SBI, Reliance, TCS, and L&T—helped investors make a profit over five days.

During last week's trading, investors in the largest public sector bank, SBI, were in the most advantageous position. The bank's market capitalization reached 10.12 lakh crore rupees. Calculations show that investors in SBI earned a colossal 63,922 rupees in just five working days.

In addition to SBI, companies owned by Mukesh Ambani, Reliance, and the IT giant Tata Group, TCS, also performed well. RIL's market capitalization increased by 32,816 rupees, reaching 18.02 lakh crore rupees. TCS increased its market value by 31,875 rupees, reaching 8.88 lakh crore rupees. L&T also provided its investors with a return of 14,638 rupees over five days, bringing its capitalization to 5.56 lakh crore rupees.

While the largest public bank saw a significant increase, the largest insurance company, LIC, suffered the biggest losses over the past week. LIC's market capitalization decreased to 4.97 lakh crore rupees, reflecting a drop in its valuation of 40,543.23 rupees over five days, resulting in major investor losses.

Following LIC, Bajaj Finance incurred the largest losses, with its market value decreasing by 37,169 rupees to 6.74 lakh crore rupees. HDFC Bank lost 24,183 rupees, reducing its capitalization to 11.28 lakh crore rupees. ICICI Bank sustained a loss of 9,508 rupees, and its market capitalization stood at 10.20 lakh crore rupees. Furthermore, Bharti Airtel lost 7,582 rupees, lowering its capitalization to 12.22 lakh crore rupees, and HUL showed a decrease in market capitalization of 4,793 rupees, amounting to 4.89 lakh crore rupees.

After the fluctuations in the market capitalization of leading companies over five trading days, Reliance Industries, owned by Indian billionaire Mukesh Ambani, maintained its leading position in the ranking. It is followed by Bharti Airtel, HDFC Bank, ICICI Bank, SBI, TCS, Bajaj Finance, L&T, LIC, and Hindustan Unilever.