Equity mutual funds (MFs) saw record inflows in March, supported by strong stock markets and new fund offerings (NFOs). Data from the Association of Mutual Funds in India (Amfi) shows that equity funds recorded net inflows of Rs 28,463.49 crore, with most of the inflows coming from multi-cap funds.
In March, the S&P BSE Sensex Index rose 4%, while the S&P BSE Midcap Index and the S&P BSE Smallcap Index gained 3.22% and 5.83% respectively.
In March, all 11 equity fund categories recorded net inflows, with multicaps recording the highest inflows of Rs 9,694.56 crore, followed by large and mid cap funds at Rs 3,164.67 crore, show Amfi data. The surge in inflows into multicap funds was largely due to the NFO fund of the SBI Multicap fund which raised Rs 8,170 crore.
Market participants say that despite market volatility, investors have continued to invest through Systematic Investment Plans (SIPs). In the current financial year, equity funds recorded net inflows of Rs 1.64 trillion.
However, debt funds saw net outflows of Rs 1.14 trillion, driven by high redemptions of cash funds, overnight funds and corporate bond funds. Typically, at the end of each quarter, there are high debt regime repayments as institutions such as banks and corporations redeem their investments to pay the quarterly withholding taxes.
Overall, the MF industry recorded net outflows of Rs 69,883 crore in March and the average assets under management (AAUM) in the industry stood at Rs 37.70 trillion.