FII vs DII: Structural shift from foreign capital dependence to domestic capital resilience

Indian markets are undergoing a structural shift with domestic institutional investors (DIIs) commanding a record 19.6% of NSE-listed companies in March 2026, while FII ownership fell to a 17-year low of 15.8%. Monthly SIP contributions stood at about Rs 30,954 crore in May 2026, with the mutual fund industry managing close to Rs 81.58 lakh crore in assets and equity MFs recording net inflows for 63 straight months. Despite FII outflows of about Rs 1.92 lakh crore by early May 2026, DIIs deployed a record around Rs 4.3 lakh crore in H1 2026, absorbing selling pressure and demonstrating growing domestic capital resilience.