Equity MF inflow dips 9% to Rs 37,113 cr in July

The fall was primarily due to a slump in large-cap and mid-cap categories. However, the overall industry witnessed net inflows of Rs1.9L cr, pushing AUM to a record high of Rs65L cr. SIP contributions also hit a new peak of Rs23,332 cr

Inflow Trends

♦ Short-term debt categories gained

♦ Liquid funds saw massive inflows

♦ 100 million investors in next 3-4 years

♦ SIP hit an all-time high of Rs 23,332 cr

♦ Industry expected to surpass Rs1-trn AUM

♦ Debt Inflows witnessed Rs1.2L cr net inflows

♦ Sector/thematic funds remained top inflow category

New Delhi: Inflow in equity mutual funds declined 9 per cent month-on-month to Rs37,113 crore in July owing to the drop in fund infusion in large-cap, small- and mid-cap categories.Despite the dip, the quantum of net inflows witnessed in July was the second highest flows ever received in a month. Also, this was second only to the flows of Rs 40,608 crore received in June. The latest flow also marks the 41st consecutive month of net inflows in equity funds, data with the Association of Mutual Funds in India (AMFI) showed on Friday Moreover, monthly contributions from Systematic Investment Plan (SIP) rose to an all-time high of Rs 23,332 crore in July as against Rs 21,262 crore in the preceding month.

This reflects the growing financial discipline among retail investors, helping them build wealth systematically over time, Venkat Chalasani, Chief Executive, AMFI, said. Overall, the mutual fund industry has witnessed an inflow of Rs 1.9 lakh crore in the month under review as compared to an outflow of Rs 43,637 crore in June. The inflow was due to investment in equity as well as debt schemes. With these inflows, the industry’s net assets under management rose to an all-time high of Rs 65 lakh crore in July-end from Rs 61.15 lakh crore in June-end. “The share of financial assets has been increasing rapidly and within financial assets, mutual fund market share is relatively high. Mutual funds play a key role in enabling wealth creation for individual investors and providing tools for long-term financial planning. I am sure that the mutual fund industry will surpass the milestone trillion AUM and 100 million investors in the next 3 to 4 years; time,” Hitesh Thakkar, Acting CEO of ITI Mutual Fund, said.

According to the data, except for the focused and equity-linked saving schemes (ELSS) categories, all the other categories witnessed good net inflows. “Inflows into equity mutual funds witnessed a dip after two months of record surges, as the flows in the large-cap category slumped by 31 per cent Rs 670.12 crore. Equity inflows declined by 8.61 per cent MoM to stand at Rs 37,113.39 crore in July backed by a decline in the flows for small & mid cap category as well (witnessed a MoM fall of 7 per cent to Rs 1,644 crore & 35 per cent to Rs 2,109 crore respectively),” Jean Christophe Gougeon, Director & Chief Marketing Officer, Sharekhan by BNP Paribas, said.

Feroze Azeez, Deputy CEO, Anand Rathi Wealth Ltd, said the decline was partially fuelled by shift from PMS to mutual funds due to change in taxation. Within the equity schemes, sector or thematic funds attracted investors with the highest net inflows of Rs 18,386 crores during the month.