Foreign investors are making a strong comeback to Indian stocks, driven by big-ticket deals worth $5.5 billion in May. This marks the highest monthly total for block trades in almost a year. It’s a sharp jump from just $220 million in April.
What does this mean for you and me? Simply put, big-ticket deals are a sign that global investors are betting again on India’s market, which could push stock prices higher and open doors for more investment opportunities here.
According to Abhinav Bharti, head of JPMorgan’s India equity capital market business, a diverse group of overseas investors—many of whom were “missing in action” for the last six months—have returned. These investors had earlier pulled out, saying India was too expensive. But now, they’re showing up again.
Why the sudden change of heart? Indian stocks have been holding steady despite global tensions. The Nifty 50 index has climbed 6% since early April, helped by India’s status as a safe haven during trade tariff worries. Foreign investors have bought about $3 billion worth of Indian shares in April and May combined, according to data.
The $5.5 billion big-ticket deals in May included some eye-catching names. British American Tobacco sold a $1.5 billion stake in ITC.
IndiGo’s co-founder, Rakesh Gangwal, offloaded a 5.7% stake in the airline for $1.36 billion. Meanwhile, Singapore’s Singtel sold $1.5 billion worth of Bharti Airtel shares. Both ITC and IndiGo deals grew bigger due to strong demand.
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Sunil Khaitan of Goldman Sachs India says the investors coming back are mostly those who know the Indian market well and are waiting for the right moment. “Around 90% to 95% of foreign money coming back is from deeply embedded India investors,” he said.
For the average investor, this means a healthier market with more activity and possibly better returns. But some experts, like Gary Tan from Allspring Global Investments, remain cautious. He says India’s valuations in some sectors are still high, so he prefers to add selectively, favoring banking, telecom, and diversified companies.
The big-ticket deals could also be a sign that IPO activity might pick up soon. Block trades often set the stage for new listings, signaling confidence among big players.
India’s improving economy, recent tax cuts, and interest rate cuts have all helped boost investor sentiment, according to M Arvind Vashisth of Citigroup. “The economy is in good shape, valuations are more reasonable, and investors are actively looking for good companies to invest in,” he added.
So, if you thought Indian stocks were a no-go zone for foreign investors lately, think again. The big-ticket deals in May are telling a new story — one of return, confidence, and maybe a bit of the classic “India growth” magic kicking back in.
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