FPIs Pull ₹1,446 Cr in July; Services and Metals Attract New Flows

FPIs turn selective in july; services and metals gain as IT, FMCG face selling pressure, foreign portfolio investors (FPIs) slowed their buying activity in July 2025, pulling out ₹1,446 crore from Indian equities in the first fortnight. This marks a shift after three months of steady inflows, including ₹14,590 crore in June alone. The trend points to rising caution, with investors moving away from expensive sectors and looking for value in more cyclical areas.

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A Clear Rotation in Sector Preference

Data from NSDL shows that FPIs are adjusting their portfolios. Funds are shifting from defensive sectors such as Information Technology (IT), Fast-Moving Consumer Goods (FMCG), and Healthcare into areas like Services, Metals, and Capital Goods—segments that typically perform better in an improving economy.

IT stocks saw the highest outflows, totalling ₹5,479 crore, after a strong showing in June.
FMCG continued to face pressure, with FPIs selling ₹1,428 crore worth of shares, adding to the ₹3,985 crore they exited in June.
Healthcare also remained under pressure, with outflows of ₹757 crore in early July.

Where the Fresh Money Went

Not all sectors were hit. Several cyclical and service-based industries attracted fresh capital:

• The Services sector led with net inflows of ₹2,733 crore, up sharply from ₹346 crore in June.
• Metals & Mining bounced back with ₹1,724 crore in inflows, reversing June’s outflow of ₹357 crore.
• Consumer Services attracted ₹953 crore, continuing the positive momentum from the previous month.
• Capital Goods received ₹922 crore, helping offset the ₹1,831 crore pulled out in June.
• Financial Services remained strong, with ₹820 crore in July inflows, following nearly ₹9,000 crore in June.

Mixed Signals in Other Segments

Some sectors continued to face profit booking:

Automobile and Auto Components saw outflows of ₹1,159 crore, turning negative after strong June inflows.
Consumer Durables also experienced selling, with FPIs exiting ₹1,292 crore in July.
Oil, Gas & Consumable Fuels remained positive but slowed, drawing ₹905 crore compared to over ₹6,000 crore in June.

Despite pulling back from the secondary market, FPIs remained active in primary offerings, especially through Qualified Institutional Placements (QIPs). This shows that investors are being more selective, focusing on companies with better valuations and earnings outlooks.

Conclusion

The first half of July suggests that FPIs are adopting a cautious, stock-picking approach amid global uncertainty and high domestic valuations. While sectors like IT and FMCG saw steep outflows, Services and Metals gained ground. As quarterly results continue and global cues evolve, FPI behaviour will likely remain sensitive and data-driven.