FPIs turn buyers in IT stocks for first time in 2026, invest Rs 3,358 crore in July

Synopsis

In July, overseas investors turned their attention to Indian IT stocks, marking the first instance of such purchases this year. The consumer durables and healthcare sectors also witnessed a surge in foreign portfolio investments. By mid-July, foreign investors emerged as net buyers in equities, expanding their investments in consumer services, automobiles, and chemicals, although they offloaded shares in metals, mining, power, and financial services.

Mumbai: Overseas investors turned buyers in India's beaten-down information technology shares in July, with inflows of ₹3,298 crore in the second half and ₹3,358 crore during the month - the first net buying in the sector this year. Consumer durables drew ₹4,958 crore and healthcare ₹3,654 crore from foreign portfolio investors in the July 16-31 period, amid early signs of their renewed appetite for Indian stocks.

FPIs turned net buyers of equities worth ₹4,640 crore in the second half of July, adding to ₹15,560 crore in the first fortnight, according to NSDL data. July was only the second month of net inflows since February.

Agencies

july 16-31 trades Overseas investors cautiously broaden their buying beyond frontline stocks, with consumer durables and healthcare among the beneficiaries

"It seems like money is slowly moving into broad markets from the index heavyweights," said Pankaj Pandey, head of fundamental research at ICICI Direct, pointing to Nifty hovering around 24,000 while midcap and smallcap indices scaled fresh highs. The Nifty 50 and Sensex gained nearly 2.1% each in July, while the Nifty Midcap 150 and Smallcap 250 rose 1.6% and 1.1% respectively.

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FPIs also remained net buyers in consumer services, automobiles & auto components, construction materials and chemicals, with purchases ranging between ₹532 crore and ₹2,840 crore in the July 16-31 period.

"Domestic demand remains the clearest theme based on the latest trend," said Raj Gaikar, research analyst at Samco Securities, referring to flows into consumer durables, consumer services and healthcare for three consecutive fortnights.

FPIs, however, sold shares worth between ₹1,056 crore and ₹3,618 crore in metals & mining, power, construction, financial services, telecom and capital goods. Selling in financial services came after two fortnights of buying in June and early July.

Vikas Gupta, CEO at OmniScience Capital, said the shift may reflect tactical trades. "The current selling of financial services and buying into IT could be reflecting a short-term trade. There is significant uncertainty about medium-term revenues and profits of IT companies, while financial services show clearer growth visibility."

Gaikar said while pressure in IT has eased, he would wait a few more fortnights before calling a bottom for these stocks.

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