Global investors are once again flocking to Indian stocks as the bull run continues.

Overseas funds are increasingly investing in Indian stocks, signaling a strong return to the $5 trillion market following a brief pause due to election-related uncertainty earlier this year. With net foreign purchases reaching $8.5 billion this quarter, the total is on track to be the highest since mid-2023, according to Bloomberg data. Confidence in policy stability has been bolstered after Prime Minister Narendra Modi secured a third term, and India’s weighting in certain global indexes has surpassed that of China, creating a promising outlook for future inflows—especially as the Federal Reserve begins to cut interest rates.

This surge in investment reflects growing investor confidence in India’s equity valuation, which, while high compared to other emerging markets and its historical averages, aligns with the nation’s benchmark NSE Nifty 50 Index, which is set for its ninth consecutive annual gain.

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