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Shifting Sectoral Preferences in CY24

ICICIdirect Research 27 Dec 2024 DISCLAIMER

While overall FII flows were flat for the year, there was notable turbulence in sectoral allocations. Legacy sectors, including blue-chip names, experienced continued outflows as FIIs redirected funds toward emerging new names.

The Banking, Financial Services, and Insurance (BFSI) sector, which accounts for 32.5% of the NSE 100, and the Oil & Gas sector, with a 10% weight, saw combined outflows of nearly ₹1 lakh crore. Instead, sectors like Capital Goods, Healthcare, and Telecom attracted cumulative net inflows of approximately ₹75,000 crore from FIIs by November 2024.

This realignment highlights a pattern shift in investor preferences, with money flowing away from traditional heavyweights to sectors poised for future growth such as small cap and midcap.

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