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Equity mutual funds log 16% sequential fall in inflows to ₹15,480 crore in June

Retail investors stayed bullish as Amfi data showed that monthly systematic investment plan (SIP) contribution came in at ₹12,275.79 crore in June. (Photo: iStock)

2 min read . Updated: 08 Jul 2022, 01:16 PM IST Livemint

Net assets under management (AUM) of the mutual fund industry fell to ₹35.64 lakh crore in June from ₹36.98 lakh crore in May

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NEW DELHI: Indian investors continued to put their faith in stock markets as open-ended equity mutual funds saw positive net inflows for the 16th straight month in June at ₹15,497.76 crore, as per data released by the Association of Mutual Funds in India (Amfi) on Friday.

However, equity inflows last month fell 16% sequentially, as rising inflation, geopolitical turmoil, and selloff by foreign investors hit investor sentiment.

On the other hand, open-ended debt mutual funds saw net outflows of ₹92,247.63 crore in June, as corporates redeemed their debt investments for advance tax payments and banks wanting to avoid capital charge enforced by the Reserve Bank of India.

Consequently, net assets under management (AUM) of the mutual fund industry fell to ₹35.64 lakh crore in June from ₹36.98 lakh crore in May.

Retail investors stayed bullish as Amfi data showed that monthly systematic investment plan (SIP) contribution came in at ₹12,275.79 crore. Further, the number of SIP accounts stood at all-time high in June at 5.54 crore, surpassing the May high of 5.48 crore.

Speaking on the numbers, N S Venkatesh, chief executive officer, Amfi said, “Strong momentum towards big mega-trend of financialisation of savings being observed across the country continues to remain intact, even in the backdrop of subdued macro-economic situation, both domestically and globally. Rising interest rates, globally, weakening rupee, mixed start to monsoon in India and rising retail inflation in India and globally too, has not deterred small savers from continuing to patronize SIP mode of savings."

In the equity category, flexi-cap, large-cap and large and mid-cap schemes emerged as top three in net flows.

In the hybrid category, dynamic asset allocation/ balanced advantage fund, balanced hybrid & aggressive hybrid, and conservative hybrid witnessed positive flows.

The data also showed that at ₹17.91 lakh crore, the net AUMs under retail equity schemes (Equity + Hybrid + Solutions oriented) rose 16% year-on-year, while average AUMs under retail equity schemes increased 18% and stood at ₹18.13 lakh crore as on 30 June.

Akhil Chaturvedi, chief business officer, Motilal Oswal AMC, said, “These trends reflect sign of maturity in investors mindset. SIP contribution remaining above ₹12,000 indicates better awareness among retail investors about long term orientation of equity investments and understanding of current volatility as a part and parcel of equity investing. Instead of reading too much into net equity inflow dipping, the heartening thing to note is that both net equity inflow and net inflow into hybrid funds remained resilient despite relentless selling by FPI’s and market correction during the year so far."