Foreign Portfolio Investors (FPIs) net sold Indian equities worth ₹25,744 crore in January 2024 even as they remained bullish on sovereign debt, pumping in ₹19,836 crore in Indian debt markets, data with depositories showed. 

This was the highest monthly outflow from equities since January 2023. This renewed selling in Indian equities was largely prompted by the rise in U.S. 10-year yields to about 4.18 per cent during January 2024 and lower-than-expected Q3 earnings from certain large private sector banks.

However, with the U.S. Yields now having corrected sharply to a 3.86 per cent level, the FOI selling pressures have moderated, say experts.

V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said that FPIs are switching from equity to debt. 

“The main reason for the renewed selling in equities is the bounce back in U.S. 10-year yield from the low of 3.85% to around 4.16%. But the yield has again corrected sharply back to 3.86 % level. This is likely to restrain FPIs  from renewed selling. February 2024 is unlikely to witness the kind of selling witnessed in January 2024”, Vijayakumar added.

He also said that FPIs sold heavily in HDFC Bank in January 2023 since that stock was among their largest holdings in India. 


FPIs were net sellers not only in January 2024 but also net sold Indian equities in January 2023 and January 2022. 

While FPIs pulled out $3.7 billion in January 2023, they withdrew $4.8 billion in January 2022 from the Indian equities market. 

However, the January 2024 selling comes from heavy buying witnessed in the preceding two months.

FPIs had in December 2023 purchased a record ₹66,135 crore in Indian equities. In November 2023, Indian equity markets saw positive inflows from FPIs as they invested ₹9,001 crore in equities.

Overall, the total FPI flows for 2023 stood at ₹1,71,107 crore in equities and ₹68,663 crore in the debt market. Together, FPIs invested ₹ 2,39,770 crore into the capital market.

Alok Agarwal, Head Quant & Portfolio Manager, Alchemy Capital Management, said that FPIs were net sellers in Indian equities to $3.1 billion in January 2024. 

FPIs Assets Under Custody stood at $817 billion which is about 18% of India’s market capitalisation, he noted.

As per data from SEBI/NSDL, the FPIs were net buyers in the first half of the month to $402 million. During this period, they were net buyers in the Oil & Gas, Financial Services, Power and Realty sectors. On the other hand, they were seen reducing positions in the Auto, Media, IT and FMCG sectors, Agarwal added.


Ahead of India’s inclusion in global bond indices from June 2024 this year, FPIs have been briskly buying sovereign debt. Even in January 2024, FPIs purchased ₹19,836 crore. In December 2023 and November 2023, they invested ₹18,302 crore and ₹14,860 crore, respectively, in Indian debt markets.