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According to data from depositories, foreign portfolio investors experienced a net outflow of Rs 28,242 crore in equities this month (till May 17).
There are two main reasons why FPIs have been selling in FY2025.
Karthick Jonagadla foresees challenges for private banks and FMCG sectors. FY25 market returns may moderate with high performers in specific sectors. Earnings growth alignment for midcap and smallcap stocks, capital inflows shift, and sector opportunities in lower interest rates are key considerations. Jinagadka also says: "PSUs, defence manufacturing, and rural consumption themes not only highlight the diverse avenues available for investors but also reflects the multifaceted nature of Indias growth trajectory."
Mutual fund SIP inflows surged to Rs 2 lakh crore in 2023-24, up 28% YoY. SIP book touched Rs 19,270 crore in March 2024. Industry aims for Rs 25,000 crore milestone by 2024.
A cautious approach towards the banking and NBFC sectors seems prudent in the near term, says Karthick Jonagadla.