Archive · 28 Sep 2026
FPIs Sell Equities While Pouring Money Into Indian IPOs
Foreign investors are selling many shares on stock exchanges in India.
At the same time, they are buying shares in new companies through IPOs.
They invested ₹8,551 crore in IPOs through September 25.
They have also been selling large companies while buying some mid-sized and smaller companies.
Experts say high US bond yields may make other investments more attractive.
They also say Indian IPOs have recently offered better returns.
One expert believes some investors are selecting individual opportunities rather than buying India’s market broadly.
The reports give different totals for overall exchange selling in 2026.
FPI equity outflows through exchanges reached ₹25,682 crore, with sources differing on whether the figure is through August 25 or September 25.
FPIs invested ₹8,551 crore in India’s primary market through September 25, according to NSDL data.
Sources report differing 2026 exchange-selling totals: ₹2,95,971 crore in one account and ₹2,41,572 crore in another.
FPIs have sold large-cap stocks while continuing to buy IPOs and mid- and small-cap shares.
Analysts cite high US bond yields, relative valuations and IPO returns as factors shaping FPI decisions.
- Who
- Foreign portfolio investors, market analysts, Dr V K Vijayakumar of Geojit Investments Ltd, and Mohit Gulati of ITI Alternates.
- What
- FPIs are selling equities through exchanges while investing in IPOs and selected mid- and small-cap stocks.
- When
- The reports cover September 2026, with ₹25,682 crore in exchange outflows reported through either August 25 or September 25, depending on the source; IPO investment is reported through September 25.
- Where
- India’s stock exchanges and primary market.
- Why
- Analysts cite high US bond yields, relative valuations, a weaker rupee, better IPO returns and stronger performance in mid- and small-cap shares.
Continued Selling Pressure
Selective Indian Investment
Meaning of the divergence
Continued Selling Pressure
Selling through stock exchanges suggests global investors are reducing broad exposure to Indian equities, with relative valuations, a weaker rupee and better opportunities elsewhere cited as reasons.
Selective Indian Investment
Investment in IPOs and selected mid- and small-cap shares shows that FPIs still see opportunities in specific parts of India’s market.
Future outlook
Continued Selling Pressure
High US bond yields, elevated crude oil prices and the valuation gap between large-caps and mid- and small-caps could keep pressure on Indian equities.
Selective Indian Investment
Mohit Gulati said India remains diversified and supported by strong domestic flows, while global investors could return when the growth cycle improves.
IPO participation
Continued Selling Pressure
The IPO pipeline may mainly be providing an exit opportunity for private-equity and venture-capital investors, rather than indicating broad buying of India.
Selective Indian Investment
Dr V K Vijayakumar said IPOs have delivered superior returns since June, encouraging continued FPI participation in the primary market.
- Exchange outflows
- ₹25,682 crore; one source says through August 25, while another says through September 25
- Primary-market investment
- ₹8,551 crore through September 25
- Reported 2026 exchange-selling total
- ₹2,95,971 crore in one account; ₹2,41,572 crore in another
- IPO activity
- Around 34 IPOs entered the primary market in September, with more expected
- Large-cap activity
- FPIs have remained sellers
- Mid- and small-cap activity
- FPIs have continued buying
- Market performance
- Indian stock markets ended lower for a seventh consecutive week
