FIIs and DIIs turn net buyers in March, pump over $5 billion into Indian equity market

FIIs invested $975 million while DIIs made even stronger contributions with $4.3 billion in net purchases during the month, according to the JM Financial Securities’ report.

The month witnessed a remarkable turnaround in FII sentiment. In the first half of March, up to the 19th, FIIs were net sellers, but they turned aggressive buyers in the latter half, pouring $3.6 billion into Indian equities.

This shift helped push FII shareholding in Indian stocks up to 16.8 per cent in March, compared to 15.9 per cent in February, the report said.

The sectors that attracted the most foreign inflows included banking, financial and insurance services (BFSI), telecom, and metals.

BFSI led the way with $1.7 billion in FII inflows, followed by telecom at $360 million, and metals at $219 million.

Other sectors that gained investor attention, albeit at a smaller scale, were realty, chemicals, media, and pharmaceuticals.

The report also highlighted that FIIs continued to maintain strong exposure in key sectors. BFSI, IT, Oil & Gas, Auto, and Pharma together accounted for nearly 60 per cent of total FII holdings in Indian equities.

The share of BFSI in FII Assets Under Custody (AUC) in India rose to 31.2 per cent in March from 30.8 per cent in February, while Pharma’s share edged up to 6.9 per cent from 6.8 per cent.

However, IT services -- the second-largest sector for FII holdings -- saw its share decline to 9 per cent from 9.9 per cent in the previous month, influenced by ongoing geopolitical uncertainties.

Auto declined to 6.7 per cent from 7 per cent, while Oil & Gas remained unchanged, the report said.