Local institutions' mega bet propels market as FIIs sell

Even as foreign investors have turned cautious, their large domestic counterparts emerged as the engines of India's 2025 stock market rally, pumping in record inflows and offering a resilient counterweight to global volatility.

- Dipti Sharma

Domestic institutional investors (DIIs) infused ₹3.44 trillion into Indian equities from January to June—the highest ever for this period since 2017, data from NSDL and BSE showed.

Foreign institutional investors (FIIs) sold Indian equities worth ₹82,389 crore during the same period.

One of the biggest shifts in the market is that more Indian households are steadily investing through systematic investment plans (SIPs). It is a real change in how people think about saving, putting small amounts regularly into the stock market and becoming part-owners of strong Indian companies. This is not quick, speculative money; it is long-term and consistent, explained Jiten Doshi, co-founder and chief investment officer, Enam Asset Management Co.

According to Doshi, India's economic resilience—GDP growth over 7%, stable inflation, robust corporate earnings and liquidity driven by the Reserve Bank of India's (RBI) rate cuts are making equities the go-to vehicle for longterm wealth creation.

"The market rally is a function of three core forces: the earnings trajectory, the participation structure, and liquidity," says Doshi.