DIIs Upset Market Balance as Nifty50 Sees Domestic Edge over FIIs
DIIs Upset Market Balance as Nifty50 Sees Domestic Edge over FIIs
DIIs push gains in Nifty50 while FIIs trim holdings; MOFSL data shows domestic institutions taking the lead in key names as December 2025 numbers roll in.
Domestic institutional investors (DIIs) have significantly increased their stakes in Nifty50 stocks, while foreign institutional investors (FIIs) have trimmed their holdings, according to Motilal Oswal Financial Services Ltd (MOFSL). As of December 2025, FII holdings in the Nifty50 fell 90 basis points (year-on-year) and 20 basis points (quarter-on-quarter) to 24.3 per cent, MOFSL noted. This shift highlights a changing dynamic in India’s equity markets, with domestic investors stepping in as FIIs pull back.
On the other hand, DII holdings rose to an all-time high of 24.8 per cent, up 170 basis points YoY and 30 basis points QoQ, signaling strong confidence from Indian institutions. More strikingly, on a YoY basis, DIIs increased holdings in 41 out of 50 Nifty stocks, while FIIs reduced stakes in 39 companies. QoQ, DIIs raised stakes in 35 stocks, with FIIs cutting exposure in 33.
The data also pinpoints specific stocks driving the gains for DIIs. The largest YoY gains in DII holdings were seen in Eternal, Dr Reddy's Laboratories, Asian Paints, Tech Mahindra, Interglobe Aviation (IndiGo's parent), Trent, Max Healthcare, Shriram Finance, Axis Bank, Bajaj Auto and Tata Consumer Products. While overall participation by FIIs declined, select names still attracted foreign interest year over year, including Bharti Airtel, Eicher Motors, Grasim, Bharat Electronics, Bajaj Finserv, Bajaj Finance, Hindalco, Maruti Suzuki, Wipro and IndiGo.
With DII holdings surpassing FIIs in the Nifty50, MOFSL’s data underscores the growing influence of domestic institutions in India’s equity markets. This shift could influence sector leadership, stock selection, and volatility in the near term, as investors assess the durability of the domestic-led trend and possible implications for fund flows and market sentiment.
