MFs, FIIs Did Buying In Telecom, Financial Services, And Services Stocks In May

Mumbai, June 16, 2025:  Mutual Funds (MFs) and Foreign Institutional Investors (FIIs) invested around Rs 78,500 crores in stocks of telecom, financial services and services sectors in May .

Telecom Sector Leads with Record Inflows:

The telecom sector emerged as a major beneficiary of these significant inflows. Mutual funds invested over ₹5,730 crore, while FIIs contributed a substantial ₹8,089 crore, underscoring renewed investor interest in this space, likely driven by growth prospects and potential industry consolidation.

Financial Services Attract the Largest Domestic Inflows

The financial services segment continued to be a strong magnet for domestic capital, attracting the largest share of mutual fund deployments, totalling ₹17,370 crore. FIIs also maintained a healthy presence, infusing ₹4,028 crore into the sector, reflecting ongoing confidence in India’s banking and financial landscape.

Strong FII Interest in Services Sector

The services sector garnered notable attention from both investor classes. While mutual funds invested ₹4,061 crore, FIIs outpaced them with significant inflows totalling ₹7,972 crore, indicating a bullish view on the growth potential of various service-oriented businesses.

Mixed Sentiment in Other Sectors

• FMCG: This segment witnessed substantial mutual fund inflows of ₹10,213 crore, indicating domestic investors’ preference for defensive and consumption-led investments. However, FII participation was relatively modest at ₹815 crore.
• Healthcare: The healthcare sector presented contrasting trends. Mutual funds remained net buyers with ₹3,029 crore in inflows, but FIIs were net sellers, pulling out ₹2,614 crore. This divergence could be due to varying assessments of specific opportunities or profit-booking by foreign investors.
• Utilities: Mutual fund investments in utilities stood at ₹2,163 crore. FIIs, however, made only marginal purchases worth ₹23 crore, indicating limited foreign interest in this relatively stable but often lower-growth sector.

What’s Ahead?

The sustained inflows from Mutual Funds and foreign institutional investors (FIIs) signal continued confidence in India’s growth story, particularly in the telecom, financial, and services sectors. Telecom may see further interest amid hopes for industry consolidation and 5G monetisation. Financials could benefit from strong credit growth and steady earnings, while services are likely to attract more capital as India expands its digital and consumption-driven economy. However, mixed trends in FMCG, healthcare, and utilities suggest selective investor interest, and future flows may hinge on global cues, rate decisions, and earnings performance in Q1 FY26.

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