India Strategy : Foreign fund flow tracker by Kotak Institutional Equities

Fund flows in July 2025. Listed funds witnessed inflows of US$842 mn, led by ETF inflows of US$1.6 bn, which were offset by non-ETF outflows of US$759 mn. GEM funds saw US$820 mn of inflows, led by ETF inflows of US$881 mn, offset by US$61 mn of non-ETF outflows. India-dedicated funds witnessed outflows of US$301 mn (US$298 mn of ETF inflows and US$599 mn of non-ETF outflows).
* Emerging market flows. Listed emerging market fund flows were positive for most countries. China has seen the highest inflows of US$4.3 bn, followed by Taiwan, South Korea and India, which recorded inflows of US$1.3 bn, US$1.2 bn and US$842 mn, respectively. Total FPI and EPFR activity showed a similar trend for South Korea, Taiwan and Thailand.
* Country allocations. Allocations to China and India constitute 40% of the average Asia ex-Japan fund portfolio. Asia ex-Japan fund allocations to India declined sharply to 15.1% in July from 16.3% in June, whereas allocations to India by GEM funds declined to 17.5% in July from 18.7% in June. Allocations by Asia ex-Japan non-ETFs declined to 16.9% in July from 18.4% in June. Allocations to India by GEM non-ETFs declined to 15.6% in July from 16.7% in June.
Product description and methodology. KIE’s foreign fund flow tracker gives a comprehensive view of the market flow by listed funds into India and its emerging market (EM) peers. These market participants are further classified based on their investment styles—passive (ETFs) or active (non-ETFs)—in an attempt to understand the intent and sentiments governing the flow. Please note that there is a difference between EPFR-reported fund flows and FPI flows reported by NSDL. EPFR fund flow data primarily tracks mutual funds, ETFs, closed-end funds and variable annuity funds/insurance-linked funds, whereas NSDL-reported FPI flows also capture investments from hedge funds, proprietary desks and sovereign wealth funds.
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