Despite elevated domestic inflows (USD 119 billion since March 2024), Indian equity markets have delivered muted returns in recent months.
This divergence between strong inflows and tepid performance has left many wondering — where is all the money going?
New supply of shares has kept pace
Surge in IPOs (USD 32 billion) and QIPs (USD 21 billion) shows that the fresh supply of equity is matching institutional demand almost one-for-one.
Selling by FIIs
FIIs have turned buyers in primary markets (investing around USD 19 billion), but they’ve remained net sellers in the secondary market, offloading nearly USD 38 billion.
Promoter selling
Promoter ownership is at its lowest level since December 2020, reflecting both profit-taking and balance sheet recalibration.
The result?
Despite strong demand, new supply of shares has kept pace, leaving little room for prices to run up.
In this environment, we prefer quality, low-volatility, large-cap, and heavy-weight portfolios — positioned to protect capital while staying ready for the next phase of growth once earnings momentum revives.
