Business · Markets · 4 hrs ago
Foreign ownership of Indian stocks hits lowest level since 2011
Foreign investors held 14.02% of Indian shares at the end of the September quarter, the lowest level since December 2011.
They bought ₹13,970 crore worth of Indian equities during the quarter, after selling heavily in the previous two quarters.
Their overall ownership still fell from June and was down 1.54 percentage points over the past year.
Investors have been cautious because Indian stocks look expensive compared with other markets, while higher US bond yields, a strong dollar and geopolitical uncertainty add to concerns.
Domestic mutual funds raised their share of Indian companies to a record 11.59%, helping absorb some foreign selling.
India’s high valuations remain a concern, despite strong revenue and profit growth among companies that have reported results so far.
A lasting return depends on stronger earnings and more reasonable valuations, while lower US interest rates could also encourage investment in emerging markets.
Foreign portfolio investors held 14.02% of shares in BSE-listed companies at the end of the September quarter, the lowest level since December 2011.
Their share fell nearly 0.4 percentage points from the previous quarter and 154 basis points over the past year.
They were net buyers in the September quarter, investing ₹13,970 crore, after large outflows in the March and June quarters.
Valuation concerns, geopolitical uncertainty, elevated US bond yields and a relatively strong dollar were cited as reasons for foreign investors’ caution.
Domestic mutual funds increased their ownership to a record 11.59%, helping offset foreign selling.
- Who
- Foreign portfolio investors held a smaller share of Indian equities. Domestic mutual funds increased their holdings.
- What
- Foreign ownership fell to its lowest level since December 2011, despite FPIs returning as net buyers in the September quarter.
- When
- At the end of the September quarter of 2026 (Q2FY27).
- Where
- Indian equities, including shares in BSE-listed companies.
- Why
- Sources cite valuation concerns, geopolitical uncertainty, elevated US bond yields and a relatively strong dollar.
This story does not have two clearly opposing sides.
Foreign portfolio investors’ share of Indian equities reached a peak of 20.09%.
FPIs pulled out ₹1.31 trillion from Indian equities.
FPIs withdrew ₹1.43 trillion.
FPIs became net buyers, investing ₹13,970 crore, while their ownership fell to 14.02%.
FPIs bought stocks worth more than ₹14,000 crore.
FPIs remained net sellers for the month, withdrawing ₹34,843 crore.
- Foreign ownership
- 14.02% at the end of the September quarter
- Lowest level since
- December 2011
- Quarterly net FPI investment
- ₹13,970 crore in the September quarter
- Mutual fund ownership
- 11.59% in September
- Companies analysed
- 5,638 BSE-listed companies
What people are saying
In our view, a combination of supportive global liquidity and stronger domestic earnings fundamentals will be essential for a durable revival in foreign investor participation