Foreign investors inject Rs 4,223 crore into Indian equities in April

Foreign Portfolio Investors (FPIs) injected Rs4,223 crore into Indian equities in April 2025, reversing a three-month trend of net outflows. This shift follows significant withdrawals earlier in the year: Rs78,027 crore in January, Rs34,574 crore in February, and Rs3,973 crore in March,according to information. Despite the April inflow, the cumulative net outflow for 2025 stands at Rs1.12 lakh crore.
V K Vijayakumar, Chief Investment Strategist at Geojit Investments, attributed this reversal to two primary factors. Firstly, the weakening of the U.S. dollar, with the dollar index slipping below 100, has made emerging markets like India more attractive to global investors. Secondly, while the U.S. and China are expected to post subdued economic growth in 2025, India is projected to grow at 6% in FY26, offering a promising outlook even amid a challenging global environment.
Market analysts attribute this reversal to a combination of favorable global cues and robust domestic fundamentals. Himanshu Srivastava, Associate Director at Morningstar India, noted that optimism surrounding a potential U.S.-India trade agreement and a weakening U.S. dollar have enhanced the appeal of Indian assets to global investors. In contrast to the equity market, FPIs withdrew Rs13,314 crore from the debt general limit and Rs5,649 crore from the debt voluntary retention route during the same period, indicating a selective investment approach.
Overall, the April inflows suggest a cautious yet positive shift in foreign investor sentiment towards Indian equities, driven by a confluence of global and domestic factors. Further bolstering investor sentiment are strong quarterly earnings from major Indian corporations, including Reliance Industries, which reported better-than-expected results. Additionally, U.S. Treasury Secretary Scott Bessent's recent comments about the possibility of finalizing a bilateral trade deal with India within a week have added to the positive outlook.

(Business Correspondent)