FPIs Dump Defensives Sell FMCG, Healthcare Stocks, Increase Bet On Financials In October’s First Half

Foreign portfolio investors (FPIs) have been net buyers in Indian equities so far in October, ending a three-month selling streak. Data from the National Securities Depository Limited (NSDL) shows that FPIs have invested Rs 7,329 crore in domestic shares till October 24, 2025.

The current buying spree marks a sharp turnaround from the previous three months, in which FPIs offloaded equities worth Rs 23,885 crore worth of shares in September, Rs 34,993 crore in August, and Rs 17,741 crore in July.

Sector-wise, FPIs have shown renewed interest in financial services stocks, while reducing exposure to fast-moving consumer goods (FMCG) and healthcare companies.

“The principal reason for this change in FII strategy is the reduced valuation differential between India and other markets,” said VK Vijayakumar, Chief Investment Strategist at Geojit Investments. He added that India’s underperformance over the past year has created opportunities for better returns going forward.

Vijayakumar also highlighted that prospects for earnings growth have improved in response to fiscal and monetary reforms, and high-frequency data point to strong sales of automobiles and consumer durables during the festive season.

FPIs Increase Exposure In Financial Services

According to a PTI report dated October 20, Commerce and Industry Minister Piyush Goyal said that foreign investors have announced plans to invest more than Rs 50,000 crore in India’s finance and banking sectors in recent months.

"In the last few months itself, investors from all over the world have announced plans to invest over Rs 50,000 crore in India's finance and banking sector," he said in a post on X.

While Goyal was referring to Foreign Direct Investment (FDI), the growing optimism is also evident in the secondary market. FPIs have been actively buying shares of financial services companies in October, with investments worth Rs 8,276 crore in the sector till October 15, the highest amount allocated to any sector this month.

FPIs also increased their exposure in automobile and auto components, metals and mining, power, and oil and gas sectors. In the auto sector, FPIs invested Rs 1,560 crore, followed by Rs 1,395 crore in metals and mining, Rs 1,103 crore in power, and Rs 1,086 crore in oil and gas, according to NSDL data.

Construction and services sectors, too, saw inflows worth Rs 641 crore and 234 crore, respectively.

FPIs Offload FMCG, Healthcare Stocks

Amid this sectoral rotation, FPIs turned cautious on the FMCG space, selling shares worth Rs 2,992 crore. The healthcare sector also witnessed outflows of Rs 2,739 crore, while IT stocks saw selling worth Rs 1,927 crore and consumer services Rs 1,785 crore.

Other sectors that recorded net outflows during the period include capital goods, real estate, chemicals, consumer durables, textiles, and construction materials.

Nifty Bank, Financial Services Indices Surge

Meanwhile, Nifty Bank index, which tracks the 12 most valuable and liquid banking stocks, gained nearly 4 per cent during the same period. The Nifty Financial Services index, too, climbed over 4 per cent in the first half of October.

On the other hand, Nifty FMCG index largely stayed flat during the same period. Nifty Pharma, however, gained 2.81 per cent, and Nifty Healthcare advanced nearly 4 per cent during the first fortnight of October.