The latest purchase follows three months of consecutive heavy selling. FPIs withdrew Rs 35,962 crore in January, Rs 22,611 crore in December and Rs 3,765 crore in November, according to depository data.
Overall, FPIs pulled a net Rs 1.66 lakh crore (USD 18.9 billion) from Indian equities in 2025, making it one of the worst periods for foreign inflows. The withdrawals were triggered by volatile currency movements, global trade tensions, concerns about possible US tariffs and a widening of equity values.
According to the data, FPIs invested Rs 22,615 crore in February. This was the highest monthly inflow since September 2024, when they invested Rs 57,724 crore.
Vineet Bollinger, director of research at Ventura, said the flow was driven by secondary market buying, signaling renewed foreign confidence after 2025.
Javed Khan, senior fundamental analyst at AngelOne Ltd., said three key catalysts supported the influx. These included Indo-US trade agreements and adjustments in India’s market value. Additionally, revenues for the third month of FY26 grew by 14.7 percent, showing confidence in the growth narrative.
Echoing similar sentiments, Varun Gupta, CEO of Groww Mutual Fund, attributed the renewed inflows to improved earnings, moderation in valuations from high levels and early signs of easing trade uncertainty, with India concluding several FTAs, including with the EU and the UK. Sectorally, there was good buying in FPI and investors. Continued exposure to the IT sector. The segment saw an inflow of Rs 10,956 crore in AI-led disruptive concerns.
“FPIs were heavily sold in IT stocks due to the anthropic shock and continued weakness in the sector. However, they turned buyers into financial services and capital goods,” said VK Vijayakumar, chief strategist at Geojit Investments.
Looking ahead, Khan said the trend in March is expected to remain positive. Q4 earnings will determine whether 15 per cent revenue growth is achievable in FY27, while a stable rupee below Rs 91 to the dollar provides comfort for a rebound.
Vijayakumar said FPIs are likely to adopt a wait-and-see approach before jumping ahead with emerging markets. However, improving GDP growth prospects and healthy corporate earnings outlook for FY27 bodes well for medium-term flows.
Meanwhile, the ongoing conflict in the Middle East has created a sense of risk in financial markets. Crude prices and its impact on currency movements remain key to watch, he added.
