Domestic players are stealing the show in India’s equity markets, as DIIs’ ownership surges past 20% for the first time since 2021, according to a fresh analysis from Motilal Oswal Financial Services. This shift marks a new era where homegrown funds are countering foreign exits with aggressive buying.
The report details $90.1 billion in DII investments throughout 2025, including $23.4 billion in Q4 alone. These purchases adeptly absorbed FII net sales of $18.8 billion while financing ₹1.95 lakh crore in capital raised via public issues.
Breaking down the Nifty 500, DII holdings now stand at 20.6%, up 2.10% year-over-year and 0.60% quarter-on-quarter. FII share slipped to 18.4%, reflecting a 0.50% annual decline despite a slight quarterly uptick of 0.10%.
In the Nifty 50 universe, DIIs command 24.8% versus FIIs’ 24.3% as of December 2025. Experts describe FII positions at their lowest in eight quarters, attributing the rise of domestic flows to structural factors like record ₹3.34 lakh crore in SIPs, burgeoning pension investments, and fresh AMC entries.
This domestic resurgence offers market stability, reducing reliance on fickle foreign funds. As India’s economy matures, DIIs are poised to drive sustained rallies, insulating benchmarks from international headwinds and paving the way for broader retail participation.