Domestic institutional investors have achieved a historic milestone by owning 21% of Nifty 500 companies, overtaking foreign institutional investors whose share has fallen to 17%. This marks nine consecutive quarters of rising domestic influence, driven by strong inflows from systematic investment plans and household savings.
DIIs invested 166 billion dollars in the last 22 months, offsetting 58 billion dollars of foreign outflows. Monthly SIP inflows averaged 3 billion dollars, ensuring steady liquidity. Their ownership increased across large, mid, and small cap stocks, reflecting broad confidence in Indian markets.
Sector wise, DIIs raised holdings in 19 of 24 sectors. The biggest gains were seen in private banks, telecom, real estate, technology, healthcare, insurance, automobiles, PSU banks, NBFC lending, retail, and capital goods. FIIs reduced exposure in 19 sectors but selectively added to metals, PSU banks, NBFC lending, capital goods, and logistics.
Financial services remain the largest allocation for both domestic and foreign investors. In the second quarter of calendar year 2026, DIIs invested 22.8 billion dollars while FIIs recorded net outflows of 13.2 billion dollars despite a late positive turn in June.
Analysts believe domestic investors will continue to anchor Indian markets, supported by household savings, insurance premiums, and retirement funds, while foreign flows may remain volatile due to global conditions.
