Debt MFs Log Rs 6,525-Cr Outflow In Feb

New Delhi: Debt-oriented mutual funds witnessed an outflow of Rs 6,525 crore in February, a sharp reversal from the strong inflow of Rs 1.28 lakh crore in the preceding month, chiefly due to redemptions in short-duration funds. Notably, 10 of 16 debt mutual fund categories reported net outflow during the month, data with Association of Mutual Funds in India (Amfi) showed. “Despite short-term redemptions, debt funds remain an important allocation tool, and flows may stabilize in the coming months as market conditions evolve,” Nehal Meshram, Senior Analyst, Manager Research, Morningstar Investment Research India, said.

Notwithstanding the outflow, the asset base of debt mutual funds marginally increased to Rs 17.08 lakh crore in February-end from Rs 17.06 lakh crore at the end of January, the data showed. As per the data, debt mutual funds experienced an outflow of Rs 6,525 crore in February following an inflow of Rs 1.28 lakh crore in the preceding month.

“Fixed income was largely negative, except for the liquid and corporate bond categories,” Anand Vardarajan, Chief Business Officer, Tata Asset Management, said. Despite the outflows, liquid funds saw the inflow at Rs 4,977 crore, followed by corporate bond funds (Rs 1,065 crore) and short-duration funds (Rs 473 crore).