Equity mutual fund inflows fall 40% to one-year low of ₹22,907 crore in May: AMFI Data
Equity mutual fund inflows declined 40% to ₹22,907 crore in May from ₹38,440 crore in April, according to data released by the Association of Mutual Funds in India (AMFI). On a year-on-year (YoY) basis, inflows rose 20% from ₹19,013 crore in May 2025.
Inflows into India’s equity mutual funds moderated to the lowest in a year in May as US-Iran peace deal uncertainty weighed on investors’ risk appetite.
Equity mutual fund inflows declined 40% to ₹22,907 crore in May from ₹38,440 crore in April, according to data released by the Association of Mutual Funds in India (AMFI). On a year-on-year (YoY) basis, inflows rose 20% from ₹19,013 crore in May 2025.
Inflows into large-cap funds declined 37% month-on-month (MoM) to ₹1,592.93 crore in May from ₹2,524.6 crore in April. Mid-cap fund inflows declined 33% to ₹4,385.06 crore from ₹6,551.4 crore. Small-cap funds attracted inflows worth ₹4,945.57 crore in May, down by 28% from ₹6,885.9 crore in the previous month.
“The lower inflows is due to extreme volatility in the markets as crude hovers around $100 a barrel, which has prompted near-term caution among investors,” said Venkat Chalasani, chief executive of AMFI.
India’s mutual fund industry’s total assets under management (AUM) dropped to ₹81.58 lakh crore at the end of May from ₹81.92 lakh crore in April.
“The moderation in flows can largely be attributed to a combination of factors. Equity markets witnessed some recovery from the corrections seen earlier in the year, reducing the urgency among investors to deploy incremental capital during periods of weakness. Elevated valuations in certain pockets of the market, particularly within the broader market segments, may have also prompted some investors to adopt a more measured approach,” said Himanshu Srivastava, Principal, Manager Research, Morningstar Investment Research India.
Additionally, the global backdrop remained uncertain, with concerns around the trajectory of global growth, evolving geopolitical developments, and the future path of interest rates continuing to influence investor sentiment.
“Against this backdrop, some degree of profit booking and temporary caution from lump-sum investors appears to have weighed on overall flows,” said Srivastava.
Debt Mutual Funds
In total, debt mutual funds recorded an outflow of ₹96,948 crore in May as compared to an inflow of ₹2.47 lakh crore in April. Barring credit risk funds, all other categories of debt mutual funds reported outflows during the month.
Among debt categories, Liquid funds saw the highest outflow of ₹29,680 crore last month, followed by Money market funds with an outflow of ₹24,691.74 crore. Corporate bond funds recorded net outflows of ₹7,009.94 crore last month against net inflows of ₹6,196.5 crore in April.
Credit risk funds attracted net inflows of ₹49.5 crore as against inflows of ₹1,317.7 crore, MoM.
Hybrid Funds
Hybrid funds received net inflows of ₹10,560.24 crore in May, registering a significant drop of 49% from ₹20,565.2 crore inflows in April.
Among the six sub-categories, arbitrage funds saw the highest inflow worth ₹5,697 crore, followed by multi-asset allocation funds at ₹3,928 crore in May. Balanced Hybrid Funds received ₹655.24 crore worth inflows and Dynamic Asset Allocation funds saw inflows of ₹181 crore.
Other Schemes
Index funds, gold ETFs, and other ETFs, registered a sharp slump of 98% in monthly inflows to ₹361.99 crore in May as compared with inflows of ₹20,082 crore in April.
Index funds received inflows of ₹943.26 crore, and fund of funds investing overseas attracted inflows of ₹763.99 crore.
Outflows from Gold ETFs stood at ₹725.04 crore in May, while that from other ETFs were at ₹620.22 crore.
Nehal Meshram, Senior Analyst, Morningstar Investment Research India noted that the reversal appears to have been driven by a combination of profit booking following the earlier rally in gold prices and a shift in investor risk appetite, with some rotation away from safe-haven assets.
“The rising opportunity cost of holding gold, particularly in an environment of relatively attractive yields in fixed income, may have contributed to the pullback. The pattern of flows also suggests that a significant portion of earlier allocations was tactical in nature, making them more sensitive to price movements and short-term macro cues,” said Meshram.
Overall, the trend points to waning incremental demand after a strong start to the year, with flows becoming more tactical and price-sensitive, rather than indicative of sustained structural allocation shifts, Meshram added.
About the Author
Ankit Gohel is the Deputy Chief Content Producer at Livemint, specialising in financial markets, macroeconomics, and regulatory developments. With a strong focus on equity markets, primary issuances, and policy-driven market movements, he brings clarity to complex financial developments for investors and market participants. <br><br> With nine years of experience in business and financial journalism, Ankit’s approach is rooted in the belief that market reporting should go beyond headlines — connecting data, policy, and ground realities to deliver actionable insights. His work consistently bridges the gap between institutional analysis and investor understanding. <br><br> Ankit has spent three years at Livemint, where he currently helps drive market coverage, editorial strategy, and high-impact financial stories. Prior to this, he worked with leading business news networks such as CNBC-TV18, ET Now, TickerPlant News Service where he built deep expertise in stock market analysis, macroeconomic trends, primary markets, and coverage of key regulators including the RBI and SEBI. <br><br> Over the years, he has covered market cycles across bull and bear phases, IPO booms, liquidity shocks, and major policy shifts that reshaped investor sentiment. He has interviewed fund managers, corporate leaders, and policymakers, translating their perspectives into sharp, data-backed narratives. Ankit combines speed with accuracy — ensuring timely, credible, and insight-driven financial journalism that empowers both retail and institutional audiences.
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