In recent months, Foreign institutional investors (FIIs) have emerged as net buyers of stocks listed on the Indian market. FIIs have pumped nearly Rs 68,900 crore into Indian equities in the last three months through 31 July 2023. FIIs are investors who put money in a foreign country outside of their own where they are registered or based.

In India, FIIs can invest in the primary as well as secondary capital markets through the portfolio investment scheme of the country. FIIs are allowed to buy stocks and debentures of the firms listed on the Indian stock exchanges. FIIs provide much-needed capital to Indian companies, which helps to boost economic growth. However, FIIs can create significant volatility in Indian stock market. If FIIs sell their shares in large numbers, it can cause the stock market to crash. Therefore, it becomes significant for investors to monitor the activities of FIIs before making any investment decisions.

Overall, FIIs can play a positive role in the Indian economy if they are managed properly. However, investors must stay aware of the risks associated with FIIs prior to any investment decisions.

Here are the top 5 stocks that FIIs have bought recently:

Maruti Suzuki India Ltd. (MSIL): The company's stock has been on a tear in recent months, and it is currently trading at peak. FIIs have been buying MSIL's stock on the expectation that the company's strong sales momentum will continue in the coming quarters. As per the company’s recent shareholding report, FIIs hold a 21.9% stake in this company, up from 21.1% in the previous quarter.
Max Healthcare Institute Ltd (MAX): This company has a market cap of over Rs 50k crore. In the previous 12 months, the stock has appreciated by 49%. FIIs hold nearly 59.9% stake in this company, up from 52% from the previous quarter. The company owns and operates healthcare facilities across Delhi NCR, and one hospital each in Mohali, Bathinda, Dehradun, and Mumbai. Max Lab is the pathology division of the healthcare group. Currently, Max Healthcare operates 17 hospitals with over 3500 beds and 4800 clinicians.
Hindustan Unilever Ltd. (HUL): The company's stock has been relatively subdued in recent months, but FIIs have been buying it on the expectation that the company's earnings growth will pick up in the coming quarters. Foreign investors hold 14.5% stake in this FMCG company. They have increased their stake marginally from 14.4% earlier.
Kotak Mahindra Bank:  This is one of the leading private sector banks in India with a track record of impressive growth. For the quarter ending 30 June 2023, the lender reported 66.6% annual jump in its net profit to Rs 3,452 crore led by higher interest income and growth in other non-fund-based income. As per the latest quarterly report, FIIs hold 39.9% stake in this company. FII holding has increased by 2.1% quarter-on-quarter.
L&T Ltd.: The company's stock has appreciated by 45% in the last one year and is just 3% away from its 52-week high of Rs 2,690.  FII holding in this company has increased from 24.4% to 25.2% in the recent quarter. FIIs have been buying L&T's stock on the expectation that the company's order book will continue to grow in the coming quarters.