FPIIndian equitiesforeign investmentmarket outflowsNSDL
FPIs Withdraw Rs 14,231 Crore from Indian Equities in May, 2026 Outflows Exceed Rs 2 Lakh Crore
Published: May 10, 2026
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Foreign portfolio investors withdrew Rs 14,231 crore from Indian equities in May 2026, according to data from the National Securities Depository Limited (NSDL), extending their net selling streak for the year. The cumulative outflow in 2026 has now surpassed Rs 2 lakh crore, exceeding the total foreign capital exit of Rs 1.66 lakh crore recorded during all of 2025.
The trend has been broadly negative since January, with only February showing a reversal as FPIs invested Rs 22,615 crore—their largest monthly inflow in 17 months. That momentum reversed sharply in March with a record Rs 1.17 lakh crore exiting the market, followed by Rs 60,847 crore in April. High crude oil prices, persistent inflation, and uncertainty over global interest rate cuts have weakened investor appetite for emerging markets.
Himanshu Srivastava, Principal at Morningstar Investment Research India, attributed the outflows to sustained macroeconomic pressures, including elevated bond yields in developed markets and geopolitical risks, particularly in the Middle East. He noted that a weaker rupee has further dampened dollar-adjusted returns for foreign investors.
V K Vijayakumar, Chief Investment Strategist at Geojit Investments, said FPIs remain selectively active in power, construction, and capital goods sectors, with interest in mid-cap and select small-cap stocks showing resilience. He cited concerns over India’s earnings growth and currency depreciation as key domestic factors influencing investor sentiment.
The Reserve Bank of India and market regulators are expected to monitor foreign flow patterns ahead of upcoming monetary policy decisions, while analysts await cues from U.S. Federal Reserve and European Central Bank rate actions to assess the next shift in FPI positioning.