Net inflows into equity mutual funds hit a 14-month high in May at 10,083 crore from 3,437 crore recorded in April, reflecting growing investor confidence in the recent market rally. This is the third consecutive month of net inflows.
With the exception of the equity-linked savings plan, which posted an outflow of 290 crore, all equity fund categories posted net inflows, with multi-cap funds leading the rankings, attracting investors. investments of 1,954 crore, according to data released by the Association of Mutual Funds. in India. Coincidentally, Aditya Birla Sun Life Multi Cap had raised 1,900 crore with its new fund offering in May.
While the mid-cap and targeted equity funds received investments of 1,368 crore and and 1,169 crore, thematic and small-cap funds received respectively 1,137 crore ₹ and 1,081 crore, respectively.
Himanshu Srivastava, associate director of Morningstar India, said the significant drop in Covid cases in recent weeks has reassured investors, while good prospects for positive earnings growth and waning concern over Wave 2 will prompt investors to reallocate assets to equities.
Share program buybacks in May fell from April, suggesting that investors are gaining confidence in the market outlook and are prepared to invest substantially.
NS Venkatesh, chief executive of AMFI, said the contribution focused on retail stocks continues to rise, as savvy investors have diversified into fund-of-fund programs that invest in foreign stocks.
Investment through systematic investment plans increased to 8,818 crore from 8,596 crore in April.
Debt funds recorded a net outflow of 44,512 crore largely due to the withdrawal of 45,447 crore and 11,573 crore from liquid and overnight funds, respectively.
Inflows of funds of funds investing abroad increased sharply by 2,424 crore, largely due to the raising of 1,704 crore from two NFOs.
Overall, the mutual fund industry’s assets under management were up to 33.05 lakh crore in May from 32.37 lakh crore in April.
Akhil Chaturvedi, Head of Sales and Distribution, Motilal Oswal Asset Management Company, said it is widely understood that the waves of Covid are short-lived and that eventually economic activities will resume, giving a boost to feelings of the market.
