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Below the Quote on FPI from Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services

"FII selling continued unabated in February, dragging the market down. The total FII sell figure for February in the cash market up to 28th stood at Rs 41748 crores. This takes the total FII selling through exchanges for 2025 up to 28th February to Rs 123652 crores. FIIs had invested Rs 11051 crores through the primary market. So, the net sales figure for 2025 up to 28th Feb stands at Rs 112601 crores.
An important paradox in FII selling is that they are selling heavily in financial services - the sector which is doing well and the valuations are attractive. FIIs are focused on selling in India because valuations in India are high and moving money to Chinese stocks where valuations are much lower. But in the process, they are selling in the best performing sector with attractive valuations.
 
When FIIs come back to India they are likely to buy the same banking stocks that they are selling now. It is important to note that FIIs are putting money in India through the ‘primary market and others’ category where valuations are moderate. In 2024 FIIs invested Rs 121637 crores through the ‘primary market and others’ category.
 
The latest GDP figures indicate that economic growth is rebounding in India. If corporate earnings follow suit the market will rebound and FIIs are likely to turn buyers. This will happen when leading indicators suggest a turn around in corporate earnings."

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