FIIs net sellers of Rs 3,765 crore till November 29, but flows may shift as sentiment turns

Foreign Institutional Investors (FIIs) have remained net sellers in the Indian equity markets so far in November, offloading shares worth Rs 15,659 crore and purchasing Rs 11,894 crore through the primary market, resulting in net outflows of Rs 3,765 crore till November 29.

However, according to V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, changes in broader market dynamics could influence a shift in FPI strategy going forward.

“There is no evidence of a trend reversal in FPI flows,” he noted. “FIIs were buyers in some days and sellers in some other days recently. This is an indication that FII flows may change when the circumstances change.”

The statement comes against the backdrop of a renewed market rally and strengthening domestic macroeconomic indicators. On November 27, both the Nifty and Sensex hit new record highs after a 14-month wait, a move that analysts have attributed to improving earnings visibility and sentiment.

“Improved corporate earnings in Q2 and prospects of further improvements in Q3 and Q4 have buoyed up the sentiments,” Vijayakumar said. He added that “the consensus market view is that 15 to 16% earnings growth is achievable in FY27.”

Q2 GDP data released during the week provided further fuel to domestic market confidence. India’s GDP growth for the second quarter stood at 8.2%, significantly exceeding estimates of around 7.2% for FY26. “This smart pick up in growth despite the Trump tariffs indicates a robust economy,” the strategist said.He highlighted the manufacturing sector’s 9.1% growth and a 7.3% rise in Gross Fixed Capital Formation as key contributors to the economic momentum. A 7.9% growth in consumption expenditure also “indicates revival of consumption, which, in turn, can revive investment demand in the economy.”Also read: Globus Spirits, VRL Logistics among InCred Equities top 10 small, midcap picks with upside potential up to 74%

Reflecting on these developments, Vijayakumar commented that “on the back of these macro trends, the market can move up further.” He added that “the macro numbers are a shot in the arm for bulls. This has the potential to halt sustained FII selling and force them to turn buyers in India.”

In summary, while FIIs continue to exhibit selling pressure in the secondary markets, emerging signs of strength in corporate performance, GDP growth, and improving market sentiment could be setting the stage for a possible change in their stance. “The optimistic new market mood and the impressive GDP numbers warrant a change in FII strategy,” he said.

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