Foreign Institutional Investors (FII) have pumped $1.22 billion into the local equities for this month, while their investments for June stood at $6.72 billion. This is the fourth straight month where foreign investors remained net buyers. 

Since January, they have pumped $11.91 billion into Indian equities, from which they have pulled out $4.3 billion from the market within the first two months of the year. FII investments have reached a significant $16 billion since March. 

Prabhudas Lilladhe said in a note to Investors, “We believe the slowdown in the US, lesser-than-anticipated recovery in China and strong likelihood of a recession in Europe reinforced India as the fastest-growing economy among large ones. We believe this will result in higher capital flows, both from FDIs and FIIs,”

The largest FII outflow was recorded in FY22 and FY23, amounting to $23 billion and a decline in FII ownership by 300 basis points to 20.3%. 

Given the robust domestic growth, revival in industrial capital expenditure, falling inflation in food and fuel prices, and government’s strong push for infrastructure development, analysts predict an increase in FII inflow.