
No, FPI selling is not an exodus. But then why is it hurting so bad?
Live MintThe noise around so-called heavy selling by foreign investors in India masks a key distinction: there are no signs of a large-scale exodus. “The figure of actual selling as a proportion of total assets might be insignificant but what's causing the turbulence is willingness to continue selling at lower levels despite being underweight India," said Nilesh Shah, managing director at Kotak Mahindra Asset Management Company Ltd. Shah explained that domestic institutional investors like mutual funds were bidding at lower levels to make FPI exits costly. FPI aggregate shareholding in Nifty Smallcap 250 rose to 13.25% as of three months ended December from 12.83% in the preceding quarter, according to capital market data provider Prime Database. Kotak AMC's Shah said that the market correction was continuing as FPIs were selling at lower levels despite being underweight India. The domestic institutional investors have absorbed the FPI selling in the secondary market by buying shares worth ₹2.73 trillion in the four months through January, according to BSE data, against the sale of ₹2.38 trillion by foreigners in the cash market during this period.
History of this topic

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FPIs Remain Wary, Dump Indian Equities Worth Rs 4,285 Crore In First 3 Sessions Of Jan
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Sensex, Nifty down 1.3% as weak rupee spark FPI selling
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FPIs are net sellers in 1st week of 2023, pulls out ₹5,872 cr from equities
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FPIs unwinding of bullish bets spurs decline in stocks
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How Nifty's dynamic with FIIs has changed
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Financials, IT sectors see bulk of FPI selling
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FPIs' exodus continues; pull out Rs 46,000 crore from Indian equities in June so far
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Explained | Why are FPIs dumping Indian stocks?
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