Sustaining positive momentum for the 14th straight month, equity mutual funds attracted a net sum of ₹ 15,890 crore in April amid heightened volatility in stock market and consistent selling by foreign portfolio investors.
This was much lower compared to a record net inflow of ₹ 28,463 crore seen in the preceding month, data from the Association of Mutual Funds in India (AMFI) showed on Tuesday.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
The lower quantum of net inflow from the previous month could be attributed to investors going slightly cautious given the ongoing challenges to the investment environment, Himanshu Srivastava, Associate Director – Manager Research, Morningstar India, said.
Akhil Chaturvedi, Chief Business Officer, Motilal Oswal AMC, said that it will be interesting to see ongoing investment trends, given the intensity of volatility being very high, and expect positive trend to continue going forward though.
Equity schemes have been witnessing net inflow since March 2021, after the second wave of COVID-19 resulted in the correction in the markets, highlighting the positive sentiment among investors.
Prior to this, such schemes had consistently witnessed outflows for eight months from July 2020 to February 2021, losing ₹ 46,791 crore.
All the equity-oriented categories received net inflows in April with sectoral/ thematic funds category being the biggest beneficiary with a net inflow of ₹ 3,843 crore. The segment also saw a launch of a new fund — ICICI Prudential Housing Opportunities Fund, which mobilised ₹ 3,130 core.
This was followed by large- and mid-cap fund and that witnessed over ₹ 2,000 crore net infusion.
“Despite volatility in markets and fear around macros both globally and locally, it is good trend to see continued positive flows in equities. Though lower than last month, which may be due to NFO allotment, SIP flows are holding strong, which is also very positive,” Chaturvedi said.
Monthly SIP (Systematic Investment Plan) contribution dropped to ₹ 11,863 crore in April compared to ₹ 12,328 crore in March.
However, the number of SIP accounts stood at all-time high in April at 5.39 crore. During the month under review, 11.29 lakh SIP accounts were added.
Apart from equities, the debt segment saw a net inflow of ₹ 69,883 crore in April after witnessing a net outflow of ₹ 1.5 lakh crore in the preceding month.
Also, gold exchange traded funds experienced a net inflow of ₹ 1,100 crore in the month under review.
Overall, the mutual fund industry registered a net inflow of ₹ 72,846 crore last month as compared to a net withdrawal of ₹ 69,883 crore in March.
“It has been a good start to new fiscal (FY23) with net flows for overall mutual funds schemes in the positive territory and continued positive equity flows for consecutive 12 months. Despite market volatility in April 2022, retail investor trust on mutual fund asset class continues to be strong,” N S Venkatesh, Chief Executive, AMFI said.