Hello Kabeer,

In Odoo, there will be view location per warehouse, which will be set as Parent Location for all auto created internal locations while you create a new warehouse or the default warehouse of Odoo.   That means, any internal location in which warehouse's view location is set, that will be consider as the warehouse's internal location. 

Odoo calculated Qty On Hand, Incoming, Outgoing & Forecast qty for only those internal locations which are warehouse's location.

Now as you described here, you have set Physical Location as parent location, Odoo won't consider such internal location as any warehouse's internal location.  Due to that reason, Odoo doesn't calculate Inventory resides in that location.   To solve it, you can set view location of any warehouse, it will then calculate it.