Indian equity markets are witnessing an unprecedented pace of selling by foreign investors. So far in 2025, Foreign Institutional Investors (FIIs) have offloaded Indian equities worth over ₹2.23 lakh crore, translating to an average sale of nearly ₹900 crore per trading day — or about ₹152 crore every trading hour.
Despite this relentless selling pressure, benchmark indices have remained resilient. The shock from FII outflows has been largely absorbed by Domestic Institutional Investors (DIIs), backed by steady inflows through Systematic Investment Plans (SIPs).
The trend has continued into December. In the month so far, FIIs have been sellers on every trading day, dumping equities worth around ₹15,959 crore. In sharp contrast, DIIs stepped in aggressively, purchasing shares worth approximately ₹39,965 crore during the same period.
This stark divergence highlights a structural shift underway in Indian markets. One of the key pillars supporting this resilience is the consistent flow of retail money into mutual funds, especially via SIPs. These regular inflows have provided a stable demand base, cushioning markets against global volatility and foreign selling.
However, a key question remains: how long can FIIs continue selling even as India’s growth outlook appears strong and corporate earnings are expected to improve?
According to V.K. Vijayakumar, Chief Investment Strategist at Geojit Investments, SIP inflows have remained robust at over ₹29,000 crore per month for the last three months. He notes that in the ongoing tug-of-war between foreign and domestic investors, these sustained inflows have significantly strengthened the position of domestic institutions.
Interestingly, while FIIs have been heavy sellers in the secondary market, they have continued to show interest in India’s primary market. So far in 2025, foreign investors have invested nearly ₹67,000 crore in primary market issuances, including IPOs and other capital-raising initiatives. This mixed behavior suggests that while short-term global factors may be driving secondary market exits, long-term confidence in India’s growth story remains intact.
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