FPIs Bet Big On Power, Capital Goods Stocks In April - Here's Why

Foreign Portfolio Investors (FPIs) stacked up shares in the power and capital goods sectors in April 2026, while reduced their exposure heavily from financial services and oil, gas & consumable fuels.

According to National Securities Depository (NSDL), FPIs bought Rs 5,557 crore worth of power sector stocks, and Rs 4,339 crore worth of capital goods stocks. Further, metals & mining sector saw FPI inflows of Rs 1,218 crore, and construction sector saw Rs 926 crore inflows.

What Drove Strong FPI Buying In Power Stocks

The rally in power stocks in April 2026 was driven by expectations of a rise in electricity demand as the country entered the peak summer season. Rising temperatures and heatwave conditions pushed peak power demand higher, as households increased the use of air conditioners and cooling appliances. Further, investors raised their bets on higher use of induction cooktops during the LPG-related disruption due to the US-Iran war, which also boosted electricity demand. For the same reason, capital goods stocks also saw higher inflows, as investors bet on higher induction cooktop sales.

Investor sentiment was further supported by strong evening demand trends. According to a JM Financial report released last month, evening power demand reached 224.6 GW at 7:00 PM on March 10, marking a 7 per cent year-on-year increase and the highest level ever recorded for March.

Coal-based plants were running at nearly full capacity to meet this demand, highlighting the continued need for reliable power supply.

Financial Stocks Continue To Bear The Brunt Of FPI Selling

On the other hand, FPIs sold financial services stocks worth Rs 30,856 crore during the month following Rs 60,655 crore sell-off in March. Banking and financial stocks remained under pressure after the Reserve Bank of India (RBI) finalised new credit-loss provisioning norms, which raised concerns about higher provisions and possible impact on profitability.

The financial services sector also accounts for nearly one-third of the total assets held by FPIs in India, making it their biggest exposure. As a result, when foreign investors reduce their India holdings, financial stocks are usually the first to see heavy selling. FPIs hold large stakes in major private banks such as HDFC Bank and ICICI Bank, which explains the scale of the outflows from the sector.

Oil, gas and consumable fuel stocks saw Rs 6,703 crore outflows in April, as the West Asia crisis dragged on, keeping crude oil prices elevated.

Overall FPI outflows from Indian equities have crossed the Rs 2 lakh crore mark so far in 2026. Foreign investors sold stocks worth Rs 60,847 crore in April, after pulling out a record Rs 1.18 lakh crore in March when concerns around the US-Iran war were at their peak. The selling trend has continued in May as well, with FPIs offloading shares worth Rs 14,211 crore till May 7.