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FII & DII allocations in BFSI rise, while they moderate in global commodities

* Flow dynamics – record DII inflows cushion continued FII outflows: A combination of geopolitical uncertainties, moderating earnings growth, and elevated valuations has kept FII sentiment toward India firmly negative, resulting in cumulative outflows of USD58b over the past 22 months since the Indian market peaked in Sep’24. However, record DII inflows of USD166b during the same period, along with resilient retail participation – average monthly SIP inflows of ~USD3b – have emerged as a powerful counterbalance, comfortably absorbing foreign selling.

* DII ownership surges for the ninth consecutive quarter: This structural shift in institutional ownership, which has gained momentum since 2021, continues to strengthen as DII holdings scale new peaks, accounting for 21% of Nifty 500 companies in Jun’26. In contrast, FII holdings declined to a new low of 17% over the same period. In 2QCY26, DIIs invested USD22.8b in Indian equities, backed by the unwavering SIP run rate. Conversely, FII flows have been volatile; although they turned positive in the second half of Jun’26 at USD1.3b vs. net outflows of USD4.3b in the first half of Jun’26 – taking the 2QCY26 FII outflows to USD13.2b.

* In this report, we explore their ownership across the Nifty

Nifty-500: DII holdings rise for the ninth consecutive quarter

* Over the past one year, DII ownership rose 160bp YoY (+20bp QoQ) to an all-time high of 21% in Jun’26, while FII ownership dipped 190bp YoY (-10bp QoQ) to 17% (from 18.9% in Jun’25).

* Promoter holdings, which have historically remained range-bound, experienced an increase of 20bp YoY (+10bp QoQ) to 49.5% in Jun’26.

* Retail holdings dipped 10bp QoQ to 12.6% in Jun’26 (+20bp YoY).

* Sectoral holding trends: Within the Nifty-500, FIIs and DIIs showcased divergent trends. On a YoY basis, DIIs raised their holdings in 19 out of 24 sectors, while FIIs reduced their holdings in 19 sectors.

* DIIs, on a YoY basis, experienced the maximum increase in holdings of Private Banks, Telecom, Real Estate, Technology, Healthcare, Insurance, Automobiles, PSU Banks, NBFC-Lending, Retail, and Capital Goods, while EMS, Media, Metals, Consumer Durables, and Consumer witnessed a reduction.

* Sequentially, DIIs clocked the maximum increase in holdings in the Telecom, Retail, Private Banks, Healthcare, Automobiles, and NBFC-Non-Lending sectors.

* On a YoY basis, FIIs raised their stakes in Metals, PSU Banks, NBFC-Lending, Capital Goods, and Logistics sectors. While the most significant reductions were visible in Private Banks, EMS, NBFC-Non Lending, Technology, Real Estate, Retail, Automobiles, Healthcare, Consumer, Oil & Gas, Insurance, Cement, and Utilities.

* On a sequential basis, FIIs raised their stakes in seven sectors – Infrastructure, Private Banks, Logistics, NBFC (Lending and Non-Lending), Metals, and Retail.

FII-DII ownership ratio remains stable sequentially

* The FII-DII ownership ratio in the Nifty-500 remained flat QoQ (-20bp YoY) to 0.8x in Jun’26. Over the last year, the FII-DII ratio expanded primarily in PSU Banks, Metals, and Logistics, while it contracted in 19 out of 24 sectors.

* As a proportion of the free float of Nifty-500, FII ownership dipped 360bp YoY (- 20bp QoQ) to 33.6%. However, DII ownership rose 310bp YoY (+30bp QoQ) to 41.5%.

* Within the Nifty-500 companies, FIIs reduced their holdings in 59% of the companies YoY, while DIIs increased their stakes in 73%.

* In the Nifty-50, FIIs reduced their holdings in 72% of the companies, while DIIs raised their holdings in 82% of the companies.

Analyzing the Caps: DIIs continue to raise their stakes across the board ? According to SEBI's categorization, large-, mid-, and small-cap stocks accounted for 65%, 23%, and 12% of the total Nifty-500 market cap, respectively.

* DIIs significantly raised their stakes across market caps to an all-time high as of Jun’26. In contrast, FIIs have reduced their holdings across market caps YoY.

* Analysis of institutional holding patterns: 1) On a YoY basis, FIIs reduced their stakes in large-, mid-, and small-caps by 230bp, 90bp, and 120bp, respectively. On a sequential basis, FIIs' stakes were unchanged in large-caps and small-caps at 19% and 10.7%, respectively. In contrast, the holdings decreased in mid-caps by 20bp QoQ to 14.3%. 2) Conversely, DIIs significantly raised their stakes across market caps by 130bp/220bp/180bp YoY (+20bp/ +40bp/flat QoQ) to 22.3%/19.1%/ 17.2%. 3) Promoters notably cut their YoY holdings in mid- and small-caps, while they rose in large-caps. Their holdings were reduced by 160bp/10bp YoY in mid-/small-caps. In contrast, the holdings rose YoY in largecaps by 70bp to 47.7% in Jun’26. 4) Retail holdings moderated in large-caps to 11% (+30bp YoY; -20bp QoQ). For mid-caps and small-caps, retail holdings were 13.3% (+30bp YoY; flat QoQ) and 20.2% (-50bp YoY, -10bp QoQ), respectively.

Private players: DII holdings at all-time highs

* We classified the Nifty-500 universe among private, PSU, and MNC companies. Notably, DII holdings in private companies rose to an all-time high of 21.8% (up 200bp YoY/30bp QoQ). Their holdings in PSU companies were at 17.3% (+140bp YoY; -10bp QoQ).

* FII holdingsin private companiesreduced by 260bp YoY and 10bp QoQ to 19.4% in Jun’26. Further, the FII stake in PSUs moderated by 50bp QoQ (+70bp YoY) to 9.7% in June’26.

* Promoter holdings in private companies increased to 45% (+30bp YoY; +10bp QoQ). For PSU companies, holdingsreduced by 180bp YoY but increased 40bp QoQ to 65.3% in Jun’26. However, MNC companies xperienced an increase in stake by 320bp YoY and 60bp to 57.5%.

* Retail holdings were up in private companies by 30bp YoY to 13.8%, while they were down by 30bp YoY in PSU companies to 7.7%.

Sectoral holdings YoY: DIIs raise holdings in 19 sectors, while FIIs reduce in 19

* Within the Nifty-500, FIIsreduced their holdings in 19 of 24 sectors: 1) FII holdings were the highest in Private Banks (41.1%), followed by Telecom (22.2%), Real Estate (18%), Consumer Durables (17.7%), NBFC - Lending (17.4%), Healthcare (17.1%), Automobiles(16.8%), Oil & Gas (15.9%), and Technology (15.6%).

* FIIsraised their stakesin Logistics(+240bp), Metals(+190bp), PSU Banks(+170bp), NBFC-Lending (+50bp), and Capital Goods (+50bp) YoY. 2) DIIs had the highest holding in Private Banks(38.5%), followed by Consumer (23.8%), Telecom (23.2%), Oil & Gas(22%), and Technology (21.8%)

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