Foreign institutional investors have pared exposure to Indian technology and several other sectors over the one-year period ending December 2025, while sharply increasing concentration in a handful of index-heavy stocks. According to an ownership analysis released by Motilal Oswal Financial Services, about $268 billion, or nearly Rs 26,83,000 crore, of total FII equity holdings in the Nifty-500 are now concentrated in just five companies, based on shareholding data as of December 2025.
Motilal Oswal’s February 2026 India Strategy report compares institutional ownership as of December 2025 with December 2024, using year-on-year changes as the primary lens, with quarterly movements used only for directional context. The brokerage shows that overall FII ownership slipped modestly to 18.4% in December 2025 from 18.9% a year earlier. However, the data indicated that there is a major churn when looked at from an in-depth perspective.
5 stocks that FIIs bought the most
A key takeaway from the report is the growing concentration of foreign capital as of December 2025. Motilal Oswal estimates total FII equity holdings in the Nifty 500 at about $867 billion at the end of the month. Of this, roughly 31% is concentrated in just five stocks.
Private banks dominate this list. Banking and financial services together accounted for 34.7% of total FII allocation in the Nifty-500 as of December 2025, up sharply on a year-on-year basis. Oil and gas exposure rose to a five-quarter high of 7.6%, while telecom also saw a significant increase in foreign ownership over the year. These gains offset reductions in technology and consumer-linked sectors.
“In terms of absolute holdings, out of the total FII holdings of $867 billion, private banks topped the chart with $199 billion in investment value,” Motilal Oswal said, adding that “the top five companies contributed 31% to the total holding value.”
- HDFC Bank
Motilal Oswal’s data shows that HDFC Bank remains the single largest recipient of foreign institutional capital in the Indian equity market. As of December 2025, the FII holding value in the stock stood at $93.5 billion, making it the biggest contributor to total foreign ownership within the Nifty-500 universe.
The brokerage places HDFC Bank at the top of its ownership table, noting that private banks as a group account for the highest absolute FII investment value across sectors. The scale and liquidity of the stock have kept it firmly entrenched in foreign portfolios, even as FIIs reduced exposure elsewhere.
Motilal Oswal also highlights that banking continues to command a large share of FII allocations, with BFSI together accounting for more than one-third of total foreign holdings in the Nifty-500.
“HDFC Bank was the single largest stock by FII holding value at $93.5 billion,” Motilal Oswal said in its India Strategy ownership analysis.
- ICICI Bank
ICICI Bank emerged as the second-largest stock by foreign holding value, with FIIs owning shares worth $58.5 billion as of December 2025, according to Motilal Oswal. The brokerage places the bank alongside HDFC Bank as a key driver of foreign exposure to Indian financials.
The report shows that private banks alone account for $199 billion of total FII equity value, underlining why this segment has remained resilient despite broader selling in other sectors. ICICI Bank’s weight within this pool keeps it central to FII allocations.
Motilal Oswal’s analysis indicates that while FIIs trimmed holdings in several sectors year-on-year, their exposure to private banks remained elevated in absolute terms, supported by index weight and market depth.
“Private Banks topped the chart with $199 billion in investment value, led by HDFC Bank and ICICI Bank,” Motilal Oswal said.
- Reliance Industries
Reliance Industries ranked third among the five largest stocks by FII holding value, with foreign investors holding shares worth $48.7 billion, Motilal Oswal data shows. The stock remains a core part of foreign portfolios due to its dominant index presence.
The brokerage includes Reliance under the oil and gas allocation, a sector where FIIs increased their weight on both a quarterly and yearly basis. This helped cushion the impact of selling seen in other large-cap segments.
Motilal Oswal notes that oil and gas exposure rose to a five-quarter high by December 2025, with Reliance continuing to anchor foreign ownership within the sector.
“Reliance accounted for $48.7 billion of total FII holding value and remained among the top five contributors,” the brokerage said in the report.
- Bharti Airtel
Bharti Airtel featured as the fourth-largest stock by foreign holding value, with FIIs owning shares worth $40.9 billion, according to Motilal Oswal. The brokerage points out that telecom was one of the sectors where FIIs increased stakes on a year-on-year basis.
The report shows that telecom saw a 330 basis point rise in FII holdings over the year, making it one of the few sectors to record a meaningful increase despite widespread selling elsewhere.
Motilal Oswal’s data places Bharti Airtel as the key driver of foreign exposure to telecom within the Nifty-500, supported by its scale and index weight.
“FIIs raised their stakes in Telecom on a YoY basis, with Bharti Airtel among the top contributors by holding value,” Motilal Oswal said.
- Infosys
Infosys completed the list of the top five stocks, with FII holdings valued at $26.7 billion as of December 2025, Motilal Oswal data shows. While FIIs reduced exposure to the technology sector overall, large index names continued to retain substantial foreign ownership.
The brokerage’s sectoral tables indicate that technology saw year-on-year reductions in FII holdings across many companies, but heavyweight stocks such as Infosys remained significant components of foreign portfolios.
Motilal Oswal attributes this to concentration rather than expansion, with FIIs preferring to hold a smaller number of liquid technology names instead of broad exposure across the sector.
“Despite a reduction in FII holdings in Technology on a YoY basis, large-cap stocks such as Infosys continued to account for a sizable share of foreign ownership,” the brokerage said.
FIIs cut technology, reduce exposure across 15 sectors over one year
Motilal Oswal’s sectoral ownership tables show that between December 2024 and December 2025, FIIs reduced their holdings in 15 of the 24 Nifty-500 sectors. Technology was among the sectors that saw year-on-year reductions, along with EMS, consumer durables, retail, infrastructure, utilities, real estate, and consumer.
The brokerage clarifies that these reductions are measured as net ownership changes over the year, based on end-period shareholding disclosures, and do not refer to selling in any specific month or event window. The report does not name individual stocks that were sold; instead, it tracks how aggregate FII ownership changed at the sector level.
At the same time, FIIs raised stakes on a year-on-year basis in PSU banks, telecom, oil and gas, chemicals, insurance, NBFC lending, and metals. This selective reallocation helped keep overall FII ownership broadly stable despite widespread selling at the stock and sector level, the report added.
“On a YoY basis, FIIs reduced their holdings in 15 sectors, with the most significant reductions seen in EMS, Consumer Durables, Technology, Infrastructure, Retail, Private Banks, Utilities, Real Estate, and Consumer sectors,” Motilal Oswal said in its India Strategy note.
Conclusion
Motilal Oswal’s ownership analysis shows that over the one-year ending December 2025, FII selling in Indian equities was selective rather than a broad exit. While technology and several other sectors saw reduced foreign ownership on a year-on-year basis, a large share of capital remained concentrated in five index heavyweights, which together accounted for about $268 billion, or nearly Rs 26,83,000 crore, of FII holdings as of December 2025.