Foreign institutional investors (FIIs) were major sellers in Indian equities through 2025, with the biggest outflows concentrated in information technology, fast-moving consumer goods, and power, according to data released by NSDL.
The IT sector saw the heaviest withdrawals, with foreign investors selling more than 45 percent of the total outflows or Rs 74,700 crore during the year. FMCG followed with sales of about 22 percent of the total selling or Rs 36,800 crore, while the power sector recorded outflows of around 16 percent of the total or Rs 26,500 crore.
Overall, foreign investors sold a net Rs 1.66 lakh crore from Indian markets in 2025, amid stretched valuations, subdued earnings, geopolitical concerns, and anxiety over steep tariffs on Indian exports. Analysts noted that global economic uncertainties and more attractive returns in developed markets contributed to sustained outflows from emerging economies such as India, adding pressure to domestic equities.
Selling in IT stocks intensified as long-term investors grew concerned that the rapid rise of AI could weigh on revenue growth for Indian technology companies, with increasing AI adoption linked to slower tech spending in key Western markets.
FMCG counters faced the second-largest outflows, driven by high inflation eroding purchasing power, weak rural demand, and heightened competition from local brands and quick-commerce platforms. The power sector also saw selling amid regulatory risks, high debt levels, and geopolitical tensions.
Other sectors that witnessed notable selling included healthcare, consumer durables, and consumer services, which recorded outflows of over Rs 25,000 crore, Rs 21,370 crore, and Rs 16,500 crore, respectively. Financials, realty, and autos also saw foreign selling to the tune of Rs 14,900 crore, Rs 12,645 crore, and Rs 11,900 crore.
Despite the broad selling trend, telecom emerged as a significant outlier, attracting substantial foreign interest on expectations of stronger cash flows, earnings recovery, and sustained profitability. FIIs bought more than Rs 48,222 crore in the telecom sector during the year.
Oil and gas, services, chemicals, metals and mining also saw net buying, with inflows of about Rs 8,431 crore, Rs 7,071 crore, Rs 6,017 crore, and Rs 4,661 crore, respectively.
The asset under custody of FIIs in equity rose marginally during the year by 4.3 percent to Rs74.27 lakh crore as of December 2025 against Rs 71.19 lakh crore a year ago.
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