Updated 31 May 2025 at 11:50 IST
India Attracts Record FPI in May at Rs 19,860, Despite Early 2025 Outflows: NSDL
India saw a record ₹19,860 crore in Foreign Portfolio Investment (FPI) inflows in May 2025, according to NSDL, despite earlier outflows in the year. Here’s what’s driving foreign investor interest.
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Foreign Portfolio Investments (FPI) | Image:
Foreign Portfolio Investments (FPI)
Foreign portfolio investors (FPIs) made a strong comeback to Indian markets in May 2025, with net inflows reaching a record ₹19,860 crore for the month — the highest so far this year, according to data from the National Securities Depository Ltd. (NSDL).
The resurgence in foreign inflows is being seen as a potential turning point in investor sentiment after months of persistent selling earlier in the year.
During the week of May 26 to May 30 alone, FPIs pumped in ₹6,024.77 crore into Indian equities. Notably, four out of five trading sessions saw positive inflows, with Friday being the sole exception, when FPIs pulled out ₹1,758.23 crore. Despite the dip on the final day, May ended on a high, reflecting renewed foreign interest in India’s capital markets.
Overall, 2025 Still in Red
Even with the robust performance in May, foreign portfolio flows remain negative for the year. From January to May 2025, FPIs have recorded net outflows totaling ₹92,491 crore. The earlier part of the year was marked by heavy selling: in January and February alone, FPIs sold Indian equities worth ₹78,027 crore and ₹34,574 crore, respectively. March also saw outflows of ₹3,973 crore.
However, the strong rebound in May has raised hopes of a sustained recovery.
What’s Driving the Turnaround?
Analysts attribute the sharp inflows to a weakening US dollar, stabilizing global cues, and improving sentiment around the Indian economy and stock markets. India’s strong macroeconomic fundamentals and growth prospects continue to act as magnets for global capital, even as investor behavior remains sensitive to global risks and interest rate dynamics.
On the final trading day of May, Indian equity benchmarks ended slightly lower, with the Sensex dipping 182 points to 81,451.01 and the Nifty 50 closing 83 points down at 24,750.70, reflecting mixed global trends.
Market watchers now look to June to see whether May’s strong inflows were a one-off or the start of a longer-term revival in foreign investor confidence.
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Published 31 May 2025 at 11:49 IST