FIIs Pour Billions into These 2 Indian Banks Amidst Market Exodus! Your Investment Guide Revealed!

In 2025, while Foreign Institutional Investors (FIIs) saw a net outflow of over Rs 256,201 crore from Indian equities, two prominent Indian banks managed to attract substantial foreign investment. Yes Bank Ltd, which had a challenging past, saw Sumitomo Mitsui Banking Corporation acquire a 24.21% stake, becoming its largest shareholder, replacing domestic institutional investors (DIIs) who had previously supported the bank. Yes Bank has shown a strong profit recovery, moving from losses to a profit of Rs 2,447 crore in FY25, with its loan book crossing Rs 250,000 crore and Net Interest Income (NII) growing 10.5%. However, its share price trades at a higher PE ratio than the industry median.

IDFC First Bank Ltd also witnessed a significant jump in FII holding, reaching 35.6%. Currant Sea Investments B.V. and Platinum Invictus B 2025 RSSC Limited collectively bought a 14.5% stake. IDFC First Bank reported robust revenue growth of 18% and its loan book expanded by 20% YoY to Rs 267,000 crore. While its Net Interest Margin (NIM) saw a slight dip, its Net Interest Income (NII) grew 17%. However, profits declined in FY25 after strong growth in prior years. These investments signal foreign investor confidence in the growth trajectory and capital needs of these banks.

Impact: This news is significant for the Indian banking sector and stock market. Increased FII interest in specific banks can boost investor sentiment, provide much-needed capital for growth, and potentially lead to improved stock performance for the targeted entities. It also signals a potential shift in FII strategy towards specific Indian financial assets. Rating: 8/10

Difficult terms: FIIs (Foreign Institutional Investors): Overseas entities like mutual funds, pension funds, or insurance companies that invest in a country's stock market. DIIs (Domestic Institutional Investors): Indian entities like mutual funds, insurance companies, and banks that invest in the domestic stock market. Loan book: The total amount of money a bank has lent out to its customers. NII (Net Interest Income): The difference between the interest income a bank earns from its lending activities and the interest it pays out to depositors. NIM (Net Interest Margin): A measure of a bank's profitability, calculated as the difference between interest income and interest expense, divided by the average earning assets. PE ratio (Price-to-Earnings ratio): A valuation metric that compares a company's stock price to its earnings per share.