Foreign portfolio investors withdrew $961 million (approximately ₹9,201 crore) from Indian metals and mining equities in June, marking the sector's most significant monthly outflow since August 2023, according to data from National Securities Depository Limited.
The capital flight coincides with broader weakness in Indian equity markets, where the benchmark Nifty 50 recently slipped below the critical 24,000 level amid heavy selling in both information technology and metals.
The immediate market reaction reflects growing concern over the sector's fundamental outlook.
While the June outflow is substantial, market participants view the move as largely tactical rather than a permanent shift in sentiment.
However, the underlying drivers for the selling are structural: persistent cost pressures and a softening global commodity market are eroding margins for Indian metal producers.
Analysts caution that the real risk for investors lies not in the foreign selling itself, but in the likelihood of continued earnings downgrades.