International portfolio buyers withdrew greater than Rs 22,530 crore ($2.5 billion) from Indian equities to date this month, extending a promoting streak that started final yr as rising US bond yields and a stronger greenback weighed on rising market flows.
The newest outflows comply with a internet withdrawal of Rs 1.66 lakh crore ($18.9 billion) in 2025, pushed by risky foreign money actions, world commerce tensions, considerations over potential US tariffs, and stretched fairness valuations.
Sustained overseas promoting has additionally contributed to the rupee’s almost 5 per cent depreciation in opposition to the greenback throughout 2025.
Information from NSDL exhibits FPIs pulled out Rs 22,530 crore from Indian equities between January 1 and January 16.
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Brokerage blues: Prime 10 gamers shed over 10% energetic customers in 2025
Market consultants attributed the continued withdrawal to a mix of world and home components.
“Rising US bond yields and a stronger greenback have improved risk-adjusted returns in developed markets, prompting capital reallocation away from rising markets,” mentioned Sachin Jasuja, Head of Equities and Founding Associate at Centricity WealthTech.
Echoing related views, Himanshu Srivastava, Principal-Supervisor Analysis at Morningstar Funding Analysis India, mentioned elevated US bond yields and greenback power have made US belongings comparatively extra engaging.
He added that geopolitical and trade-related uncertainties proceed to weigh on rising market threat urge for food.
In line with V Okay Vijayakumar, Chief Funding Strategist at Geojit Investments, lingering uncertainty over the US-India commerce settlement has additionally dampened investor sentiment.
On the home entrance, comparatively wealthy valuations in sure market segments, together with combined cues from the continued earnings season, have led to profit-taking and portfolio rebalancing by overseas buyers.
The persistent depreciation of the rupee, down almost 5% in 2025 and weakening additional to round 90.44 per greenback just lately, has eroded greenback returns regardless of secure index ranges, including additional stress on FPI flows.
Vijayakumar mentioned the promoting development might proceed till clear constructive triggers emerge for a sustained market rally. He added that the AI-led commerce that dominated markets in 2025 has carried into early 2026, although a reversal on this development might happen later within the yr.
It’s not simply overseas portfolio buyers exiting the markets. Energetic shopper bases throughout India’s brokerage business shrank sharply in 2025, with the highest 10 gamers collectively recording a double-digit decline in exercise.
NSE information exhibits that the ten largest inventory brokerages, which collectively account for almost 80% of the market, had 3.57 crore energetic customers in December 2025, down 10.3% from 3.98 crore in January.
Throughout the broader business, energetic customers fell 10.7% over the yr, sliding from 5.02 crore in January 2025 to 4.48 crore by December. This marked a transparent reversal from 2024, when energetic accounts surged 31.15%, rising from 3.82 crore in January to about 5.01 crore a yr later.
The information factors to a cooling in retail participation after a interval of exuberance, weighing even on the business’s largest gamers.
(With inputs from PTI)
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