Indian mutual funds' overseas equity holdings surge 37.5% to ₹93,602 crore

Indian mutual funds' overseas equity holdings climbed 37.5 per cent to ₹93,602 crore in FY26, reflecting growing investor interest in international markets, according to data from the Reserve Bank of India.

The substantial growth was primarily fuelled by mark-to-market gains as major global equity indices delivered strong returns during the period. Rising valuations across key international markets contributed significantly to the expansion of fund portfolios invested abroad.

Investors have increasingly turned to overseas equity schemes as an alternative to domestic investments, particularly as Indian equity markets faced headwinds during the fiscal year. The shift underscores a broader trend of portfolio diversification among Indian investors seeking exposure to global economic growth and varied asset classes.

The surge in overseas holdings reflects both active fund manager decisions to increase international allocations and passive gains from appreciating foreign assets. Mutual fund houses have expanded their range of international investment options to meet growing demand from retail and institutional investors seeking to hedge domestic market concentration risk.

The uptick in cross-border equity investments is expected to continue as investors balance their portfolios with global exposure, particularly in developed and emerging markets outside India.