Foreign investors withdraw Rs 24,753 crore in March's first week, FPI outflow so far in 2025 at Rs 1.37 lakh cr: NSDL

The latest outflows add to the heavy selling trend observed this year, bringing the total net FPI outflows in 2025 to Rs 1,37,354 crore. The sustained selling pressure has raised concerns about market stability, as foreign investors remain cautious about India's economic and corporate performance.

The primary reasons for this persistent selling include weak earnings from Indian companies, slower-than-expected GDP growth, and a sharp rise in the U.S. Dollar Index. A stronger dollar makes emerging market investments less attractive, leading to capital outflows from countries like India.

Valuation concerns have also contributed to the FPI exodus. Many foreign investors believe that Indian stocks are overvalued compared to other emerging markets, prompting them to shift funds to markets with better growth potential and lower risks.

Last month in February the foreign investors sold equities worth Rs 34,574 crore.

The ongoing FPI outflows have impacted market stability, contributing to volatility in Indian equities.

In January the FPIs withdrew Rs 78,027 crore from the Indian stock market. Last year in December the net investment by FPIs in Indian equities stood positive, with a net investment of Rs 15,446 crore.

The year 2024 marked a positive ending, but the net buying value in Indian equities by FPIs drastically reduced, declining to Rs 427 crore.

The country experienced a drastic drop in Foreign Portfolio Investment (FPI) inflows in 2024, with net investments falling by 99 per cent compared to the previous year.