At what weather conditions does the item finder find hidden items?
Pls help me out!

Any good weather condition.

Around 15-20°C.

Item finder any works in "good" weather conditions, you can check the weather by going to
Town > Explore > Travel > Weather Forecast.

From here you can see the weather, and you must check the weather from where you are for example i'm in Nuvema Town in Unova, to find my weather i could go it the Unova section on weather and then find my city which is Nuvema Town at the moment there is a Whirlwind and the temperature is 3℃, so the item finder will not work. If the weather is good the weather is Sunny and the temperature is 15% then the item finder will work and if there is a Storm and the temperature is 1% the item finder will not work, kinda just common sense :o

how will i know that i found the item?

A small pop up should appear
Go to sell items to see what items you have
Items like berries and rare items like shards and artifacts can be found using item finder
It might take awhile to find an item though

like after how many searches will the small popup show?

It's not like a pop-up,it shows same as when you find any wild map pokemon while going through map.Item finder works good,I found 9-10 items in about 1½ hours.

like pokemon capturing should we grab the item or it automatically gets into my item list?

It's like catching Pokemon, except you don't have to use a Pokeball or anything it gives you a option to pick it up just like catching a Pokemon, hope this helped.

Thanks for everyone who posted in this thread