Foreign Investment in Indian Markets Hits Record High in May 2025: NSDL Data
In a strong sign of renewed investor confidence, foreign portfolio investment (FPI) in Indian markets surged to a record high in May 2025, according to data released by the National Securities Depository Ltd (NSDL). This marks May as the best-performing month of the year in terms of foreign fund inflows.
May 2025 Sees Rs 19,860 Crore in FPI Inflows
The net FPI inflows for May stood at Rs 19,860 crore, signaling a sharp rebound in foreign investor interest after a sluggish start to the year. Despite mixed global cues, the Indian equity market remained attractive, supported by strong economic fundamentals and easing global uncertainties.
Week-Wise Breakdown: May 26–30, 2025
During the last week of May (May 26–30), foreign investors continued their buying spree, with a net inflow of Rs 6,024.77 crore.
Here’s the day-wise trend:
- ✅ Positive inflows were recorded on all trading days of the week
- ❌ Only Friday (May 30) saw a net outflow of Rs 1,758.23 crore
Despite this single-day dip, the week and month overall reflected bullish FPI sentiment.
While May brought in significant inflows, the overall FPI figures for 2025 remain negative. From January to May 2025, net outflows totalled Rs -92,491 crore.
Previous Monthly FPI Trends:
- March 2025: Net outflow of Rs 3,973 crore
- February 2025: Net outflow of Rs 34,574 crore
- January 2025: Net outflow of Rs 78,027 crore
These figures highlight the importance of May’s recovery, potentially marking a turnaround in investor sentiment.
What’s Driving the FPI Comeback?
Analysts attribute the rebound to several key factors:
- Weakness in the US dollar boosting interest in emerging markets
- Improved outlook for Indian equities, driven by strong earnings and macroeconomic stability
- Expectations of a stable global environment, especially in the second half of 2025
India’s robust economic fundamentals, including high GDP growth and improving fiscal indicators, continue to attract global investors. However, FPI flows remain sensitive to global headwinds, such as interest rate decisions in the U.S., geopolitical developments, and inflation trends.
Market Wrap: May 31 Trading Session
On Friday, the final trading day of May, the Indian stock markets closed marginally lower, tracking mixed global cues:
- Sensex ended down by 182 points or 0.22% at 81,451.01
- Nifty 50 slipped by 83 points or 0.33%, settling at 24,750.70
Despite this minor dip, the monthly performance reflects strong resilience and optimism in the broader market.
Is This a Turning Point for 2025?
May 2025 may be remembered as the month that shifted the tide for foreign investment in India. While the year started with caution and persistent outflows, the surge in May suggests that global investors are regaining confidence in Indian markets. If global conditions continue to stabilize, India could see sustained FPI inflows in the coming quarters — potentially reversing the overall negative trend seen in the first half of the year.
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