Have the FIIs lost their way?

From the bottom of 15,183 in mid-June 2022, the benchmark market index Nifty has soared 69 per cent to hit 25,791.

- DEBASHIS BASU

In the past 18 months alone, the index has surged 52 per cent. All investor segments - individuals, mutual funds, and other domestic institutional investors (DIIs) - seem to have made good money from this bull market, except of course reckless derivatives traders. This lot has lost ₹51,689 crore in FY24, according to a study by the Securities and Exchange Board of India, the regulator. What about foreign institutional investors (FIIs)? Surely, with their superior knowledge, long years of experience, and access to deep research and large funds, they should have reaped the largest benefit from this bull market? Here are some shocking overall numbers about their investment. Between June 2022 and September 20, 2024, FIIs were massive net sellers during a big bull market! Yes, you read that right. They recorded net sales of ₹1.82 trillion, the biggest monthly sales coming in June 2022, exactly at the bottom of the short, depressed period between November 2021 and June 2022. Even at those low valuations, panic sales by FIIs - of over ₹58,000 crore in June 2022 - remain unsurpassed. Indian (and global) markets were under pressure from late 2021 due to high valuation, a sharp rise in US inflation, weak post-Covid recovery in China, and the Russian invasion of Ukraine. Who did the FIIs sell to in the dark days of June 2022? To DIIs, who were huge buyers of almost ₹47,000 crore that month, at what turned out to be the market bottom.