Mumbai, Aug 25
The total inflows from domestic institutional investors (DIIs) in the secondary market stood at a record $80 billion over the past 12 months, double the $40 billion in foreign portfolio investor (FPI) outflows, according to industry data.
Despite recent volatility on the Dalal Street, the counter-buying by DIIs in response to significant selling by FPIs is greater than in past instances, including the 2008 Global Financial Crisis and the 2022 sell-off, a report from ICICI Securities said.
DIIs have pumped in over Rs 4 lakh crore into the Indian stock market this year, the largest inflow by this category in the cash market during the first seven months since 2007.
Despite this strong domestic support, the bouts of aggressive FPI selling in recent months have capped returns in Indian stock market. Indices across all market capitalisations have shown flat to negative performance over the past 12 months.
FPI inflows from April to June ranged from $1.2 to $2.3 billion while in July, the trend was reversed, with outflows reaching $2.9 billion, with continued selling in August.