How FPIs traded stocks in March 2023

  • 20 Sep 2023
  • Read 6 mins read

FPI flows – kya khareeda, kya becha?

One of the data points that is tracked closely each month is the sectors into which the foreign portfolio investors (FPIs) bought and the sectors that they sold into. Today, FPIs are not as solely impactful as before due to the rising heft of LIC and domestic mutual funds. However, FPI actions are a double whammy, as they impact equity markets and the currency exchange rate. Calendar 2023 began on a cautious note as FPIs net sold equities worth $3.54 billion in January 2023 and $639 million in February 2023. In comparison, FPIs were net buyers of $960 million in March 2023. However, scratch the surface and this was largely about one deal. GQG had invested $1.90 billion in Adani group companies, but on most of the other days, the FPIs were aggressively selling in equity markets.


Sectors FPIs bought and sectors sold in March 2023

A quick glance at the table below would tell you the story. FPI inflows were largely driven by the GQG infusion into Adani group stocks. On the sell side, IT and oil & gas were the big sell candidates. The table captures the major sectors bought and major sectors sold by FPIs in the month of March 2023.

FPIs were Net Buyers

FPIs were Net Sellers

SectorAmount ($ million)SectorAmount ($ million)
Services+879Information Technology-839
Power+390Oil and Gas-829
Metals & Mining+357Healthcare-192
Automobiles+327Financial Services-69
Capital Goods+305Telecommunications-56

Data Source: NSDL

Let us now look at what factors triggered FPI buying and what factors triggered selling by FPIs in select sectors.

What triggered FPI buying in sectors?

Let us first focus on sectors which saw net buying by FPIs in March 2023. Net FPI inflows into the services sector were robust at $879 million followed by power sector net buying at $390 million. However, both these top bought sectors represented the GQG Investment buying in Adani group. GQG bought into Adani Enterprises, Adani Green, and Adani Transmission in early March and that explains this dominance in FPI buying. Beyond the Adani story, there was net buying visible in Metals which net FPI inflows of $357 million, automobiles with net FPI inflows of $327 million and Capital goods at $305 million. Metals buying was a bet on China revival while automobiles were more of an Indian consumer play as a defensive bet. FPIs are also betting on a revival of the Indian capital investment cycle after a long break.

What triggered FPI selling in sectors?

The two sectors that accounted for most of the selling by FPIs in March were Information Technology and oil & gas. While the IT sector saw FPI selling of $839 million, the oil & gas sector saw FPI selling of $829 million. Selling in IT sector is understandable and FPIs have been cautious about Indian IT for a long time. The impact of weak tech spending by US and European corporates and margin pressure are likely to tell on the margins of IT companies. On the oil front, the selling was predominantly in Reliance Industries and in downstream oil on bets that they could face pressure on gross refining margins amidst rising crude prices. The only other sector that saw substantial FPI selling was the pharma & healthcare space.

A final look at assets under custody (AUC) of FPIs

Assets under custody (AUC) for FPIs can be understood at the equivalent of AUM for mutual funds. FPI AUC in India had peaked at $667 billion in October 2021 and has been trailing down ever since. In June 2022, the AUC of FPIs touched a low of $523 billion and as of March 2023, the AUC of FPIs stands at $542 billion. The table below captures Top-10.


FPI AUC (Mar 2023)
($ billion)

FPI AUC (Feb 2023)
($ billion)

Financials (BFSI)



Information Technology (IT) Services



Oil & Gas



Fast Moving Consumer Goods (FMCG_



Automobiles and Auto Components 



Healthcare and Pharmaceuticals



Power (generation and transmission)



Consumer Durables



Capital Goods



Metals and Mining



Data Source: NSDL

The big AUC spike is visible in Power, metals and FMCG, where fresh FPI buying has combined with positive market rallies. On the other hand, IT sector and the oil & gas sector have seen AUC fall from a peak of $72 billion in June 2022 to below $60 billion in March 2023. Overall, FPI sentiments continue to be cautious on Indian equities. While short on IT and oil is still their preferred trade, they are now going long on FMCG, Power and metals.