Weekly Musings – FPI flows for week ended January 31, 2025

3 Feb 2025 , 09:32 AM

FPI NET SELLING FOR EIGHTH WEEK IN A ROW

There was no relenting on FPI outflows in the week to January 31, 2025. After FPI selling of $2.28 Billion, $2.09 Billion and $2.57 Billion in the previous 3 weeks, the current week saw FPI selling to the tune of $1.60 Billion. That is $8.55 Billion of equity selling by FPIs in the last 4 weeks. For the third week in a row, FPIs were net sellers on all 5 trading sessions. The trigger was the gnawing uncertainty over the Union Budget 2025-26.

In terms of macros, it was a mixed week for India. The rupee weakness persisted with the rupee weakening sharply in the week from ₹86.19/$ to ₹86.54/$. There was some respite on the oil prices front after the price of Brent crude tapered closer to $75/bbl in the week. While Trump’s battle cry continues to be an overhang for the markets, the Finance Minister did present a Union Budget that addressed the 2 core issues of consumption and capex.

MACRO FPI FLOW PICTURE UP TO JANUARY 31, 2025

The table captures monthly FPI flows into equity and debt for last 4 calendar years.

Calendar Month	FPI Flows Secondary	FPI Flows Primary	FPI Flows Equity	FPI Flows Debt/Hybrid	Overall FPI Flows
Calendar 2022 (₹ Crore)	(146,048.38)	24,608.94	(121,439.44)	(11,375.78)	(132,815.22)
Calendar 2023 (₹ Crore)	1,27,759.75	43,347.14	1,71,106.89	65,954.38	2,37,061.27
Calendar 2024 (₹ Crore)	(1,21,210.21)	1,21,637.15	426.94	1,65,342.98	1,65,769.92
Jan-2025 (₹ Crore) #	(81,903.72)	3,876.78	(78,026.94)	815.91	(77,211.03)
Total for 2025 (₹ Crore)	(81,903.72)	3,876.78	(78,026.94)	815.91	(77,211.03)
For 2025 ($ Million)	(9,491.57)	448.70	(9,042.87)	80.29	(8,962.58)
# – Recent Data is up to January 31, 2025

Data Source: NSDL (Negative figures in brackets)

Year 2025 has begun on a negative note with $(8,963) Million of net selling overall by FPIs. This included $(9,043) Million of net selling in equities slightly offset by $80 Million of net buying in debt. Secondary market selling in equities has been rampant, while FPI flows into IPOs are yet to gather steam due to very uncertain market conditions.

FPI SENTIMENTS – THE WEEK THAT WAS

For the week to January 31, 2025, FPIs remained net sellers to the tune  of $(1,604) Million, lower than previous week. Here is the week that was.

• Union Budget 2025-26 was announced by the Finance Minister on Saturday. It was a sort of Big Bang budget with massive tax relief for the middle class (to boost consumption); and an earnest effort to boost capital expenditure over next 14 months to end of FY26.
• To the credit of the finance minister, the Union Budget managed to rein in fiscal deficit down to 4.8% of GDP in FY25. More importantly, the target has been lowered to 4.4% for FY26, with a glide path. That kept borrowings in check; under ₹15 Trillion.
• Core sector growth for December 2024 was steady at 3.97%, with 7 out of the 8 core sectors reporting positive traction on growth. The high weightage segments like coal, electricity, refining, and steel continue to be in the positive zone.
• The Controller General of Accounts reported that fiscal deficit had been reined in at less than 57% of full year target in FY25 with just 3 months to go. Capex spending remains tepid, but the Budget could largely change that narrative. On target for 4.8% in FY25.
• The US reported Q4 GDP growth (first estimate), lower at 2.3%, compared to 3.1% in Q3. Full year GDP growth should be over 2.5%. However, US PCE inflation for December 2024 persisted at 2.6%, with core inflation at 2.8%. Rate cuts may now be postponed.
• As the tariff war between Trump and the BRICS nations heated up, India has decided to raise the white flag. To mollify the US, India plans to cut tariffs on some of the high value goods imported from the US and also allow ease of entry.

Let us finally turn to the granular FPI flow story for January 2025.

DAILY FPI EQUITY FLOWS FOR LAST 4 ROLLING WEEKS

Here is the last 4 rolling weeks data on FPI flows in rupee terms and in dollar terms.

Date	FPI Flow (₹ Crore)	Cumulative flows	FPI Flow($ Million)	Cumulative flows
06-Jan-25	-2,874.85	-2,874.85	-335.22	-335.22
07-Jan-25	-3,055.16	-5,930.01	-355.96	-691.18
08-Jan-25	-1,220.16	-7,150.17	-142.34	-833.52
09-Jan-25	-3,729.30	-10,879.47	-434.43	-1,267.95
10-Jan-25	-7,029.38	-17,908.85	-818.50	-2,086.45
13-Jan-25	-1,421.40	-19,330.25	-165.48	-2,251.93
14-Jan-25	-4,276.46	-23,606.71	-494.75	-2,746.68
15-Jan-25	-7,766.43	-31,373.14	-897.34	-3,644.02
16-Jan-25	-4,396.93	-35,770.07	-508.31	-4,152.33
17-Jan-25	-4,341.24	-40,111.31	-501.96	-4,654.29
20-Jan-25	-3,627.11	-43,738.42	-418.91	-5,073.20
21-Jan-25	-3,724.79	-47,463.21	-430.38	-5,503.58
22-Jan-25	-6,327.90	-53,791.11	-731.43	-6,235.01
23-Jan-25	-3,018.05	-56,809.16	-348.64	-6,583.65
24-Jan-25	-3,061.48	-59,870.64	-354.09	-6,937.74
27-Jan-25	-2,866.30	-62,736.94	-332.17	-7,269.91
28-Jan-25	-4,514.16	-67,251.10	-522.36	-7,792.27
29-Jan-25	-2,940.87	-70,191.97	-339.84	-8,132.11
30-Jan-25	-1,796.22	-71,988.19	-207.47	-8,339.58
31-Jan-25	-1,753.84	-73,742.03	-202.56	-8,542.14

Data Source: NSDL

• In last 7 rolling weeks, FPIs saw net outflows of $(2,283) Million, $(2,568) Million, $(2086) Million, $(645) Million, $(600) Million, $(114) Million, and $(199) Million. In the week to January 31, 2025 net FPI equity outflows stood at $(1,604) Million.
• If you look at the last 4 rolling weeks on a cumulative basis, total net FPI outflows from equities were to the tune ₹(73,742) Crore or $(8,542) Million; with the broad trend still veering towards FPI sell-off.

The big data points that the FPIs will watch out for in next few days include; the post budget implications and the last fortnight of Q3 corporate results in India. US employment data will also remain in focus this week.