In May, 2024, there was a significant rise in the inflows of Equity Mutual Funds. According to a data from Association of Mutual Funds of India (AMFI), the inflows reached a record high of INR 34,697 crore. There was 83.42% increase from the April, marking this surge as a record breaking high.
Growth in Open-Ended Equity Funds
The inflows into open-ended equity funds continued to grow more and more, remaining positive for the 39th consecutive month. Despite various fluctuations and uncertainties, this continued growth showed investor’s confidence in the equity market. Increase in the inflows suggested a strong appetite for equity investments among investors.
Rising SIP Investments
Investment through Systematic Investment Plans (SIPs) saw a significant rise. The rise was of INR 20,904 crore in May, from INR 20,371 crore in April. This marked the second consecutive month, where SIP investments crossed the INR 20,000-crore mark. This indicates growing popularity and trust in investing in India.
Comparison with Previous Month
A remarkable surge in equity mutual fund inflows comes after a slight slump in April 2024. Inflows had decreased by 16.42% to INR 18,917.08 crore. This significant rebound in May reflects investor’s confidence and increase in appetite for equity investments.
Category-Wise Inflows
A major factor behind the surge in net investments into open-ended equity funds was the outperformance by sectoral and thematic funds. These funds saw net inflows of INR 19,213.43 crore in May. Interest in specialized market segments was reflected by strong investors. Small-cap and mid-cap funds continued to attract interest of the investors, with net inflows of INR 2,724.67 crore and INR 2,605 crore.
Interest in Large-Cap Funds
Despite the increase in equity mutual fund inflows, large-cap funds saw net investments of INR 663.09 crore. This suggests that the investors are currently more inclined towards specialized and potentially higher-yielding opportunities. Investors are more inclined towards Small-cap Funds, Hybrid Funds and Specialized Thematic Funds rather than large-cap investments.
Fixed-Income and Hybrid Fund Schemes
Net inflows in Fixed Income Schemes, saw a significant downturn, plummeting by 77.73 percent to reach INR 42,294.99 crore for the month. However, within this decline, debt funds, particularly liquid funds, experienced robust inflows, with investments surging to INR 25,873.38 crore.
The hybrid fund is known for its diverse asset allocation across equity, debt, and commodities. Hybrid Fund witnessed huge net inflows of INR 17,990.67 crore. The arbitrage fund category attracted significant buying activity, with net inflows of INR 12,758.12 crore.
Growth in Other Schemes
Other investment schemes also saw A positive growth. Index funds received net inflows of INR 4,490.35 Crore and Gold ETFs received buying of INR 827.43 Crore. This report highlights a diversified interest among investors across various mutual fund categories.
About Author
This article has been written by Mr Radhesh Tarang Shah, who is a third-year management student at Institute of Management, Nirma University. He has a passion for writing articles and poems. He has experience as a financial analyst, author, news writer, marketer and social worker.
