MF Inflows Slow in August

New Delhi, India – While Systematic Investment Plans (SIPs) continued their upward trajectory, the overall inflow into mutual funds witnessed a significant decline in August. As per the Association of Mutual Funds in India (AMFI), net inflows into mutual funds dropped by 43% to Rs 1.08 lakh crore in August compared to Rs 1.89 lakh crore in July.

Debt Funds Take a Hit

Debt funds bore the brunt of the outflow, with inflows plummeting by a staggering 62% to Rs 45,169 crore. This marked a sharp contrast to the previous month’s Rs 1.19 lakh crore inflow.

Equity Funds Show Resilience

Despite the market volatility, equity mutual funds managed to attract Rs 38,239 crore in August, a modest 3% increase from the Rs 37,113 crore inflow in July. This suggests a continued positive sentiment among investors towards equities.

Large-cap and Mid-cap Funds Gain Popularity

Large-cap funds saw a significant surge in inflows, rising to Rs 2,636 crore from Rs 670 crore in July. Mid-cap funds also witnessed increased inflows, reaching Rs 3,054 crore compared to Rs 1,644 crore in the previous month.

Flexi-cap Funds Continue to Lead

Flexi-cap funds maintained their top position among equity categories, attracting Rs 3,513 crore in inflows, up from Rs 2,081 crore in July. Value/contra funds and dividend yield funds also saw inflows, albeit on a smaller scale.

Thematic Funds Remain Popular

Sectoral/thematic funds continued to be investor favorites, garnering Rs 18,117 crore in inflows. These funds offer diversification opportunities and cater to investors seeking exposure to specific trends or industries.

Industry Experts Weigh In

Akhil Chaturvedi, Executive Director & Chief Business Officer at Motilal Oswal AMC, noted the growing investor interest in large-cap, multi-cap, and flexi-cap funds. He also highlighted the continued popularity of thematic funds, especially those tied to government reforms.

Deepak Ramaraju, Senior Fund Manager at Shriram Asset Management Company Ltd., emphasized the increasing investor confidence in the mutual fund industry, as evidenced by the record number of MF folios. He also pointed out the growing demand for equities, particularly in mid-cap and small-cap funds.