FIIs may turn net buyers in 2026 despite record outflows in 2025

Robust GDP growth and prospects of improvement in corporate earnings next year augur well for positive foreign institutional investor (FII) flows in 2026, analysts said, even as sell figure in December crossed Rs 22,130 crore.

Foreign institutional investors have net sold shares worth Rs 1,58,407 crore in CY25, marking their heaviest selling since they started investing in India. Analysts however said that there are signs of a reversal of foreign institutional investor outflows due to macro strength and earnings visibility.

“As the year 2025 draws to a close, FII selling in India is on track to set a new record in FII outflows,” said Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments Ltd. In 2024, FIIs have been selling through the exchanges, as much as Rs 1,21,210 crore worth of equities. However, for the year, the net FII inflow was positive since they had invested Rs 1,21,637 crore through the primary market. But for 2025, the net sales figure is massive, he added.

The sustained selling by FIIs have contributed significantly to the sharp depreciation in INR this year, he said, adding that improvement in fundamentals is likely to attract net FII inflows in 2026.