Inflows into the equity mutual fund hit a record high of ₹40,608 crore in June on back of buoyant equity market and huge fund raise through new fund offer.

The equity fund inflows were up 17 per cent compared to ₹34,697 crore logged in May, according to the Association of Mutual Funds in India data released on Tuesday.

Mutual funds have collected ₹15,227 crore through 17 new fund offers. Of the ₹14,370 crore was raised through 11 equity NFOs. While nine thematic funds mopped-up ₹12,976 crore, one each of multi-cap and small-cap NFOs raised ₹1,051 crore and ₹345 crore.

The overall assets under management of the industry were up 3 per cent to a new high of ₹61.15-lakh crore against ₹58.91-lakh crore logged in May, largely due to the mark-to-market gain.

Interestingly, the industry took just 6 months to add ₹10 lakh crore-asset from ₹50.77-lakh crore registered in last December.

The benchmark Sensex has rallied 7 per cent in June to hit 79,033 against 73,961 in May amid huge volatility.

The sharp rally in AUM was despite a net outflow of ₹1.07-lakh crore from debt funds last month due to redemption ahead of the quarter end for meeting statutory payment expenses.

SIP inflow up

The inflow through the systematic investment plan was up at ₹21,262 crore against ₹20,900 crore in May as the SIP AUM increased 8 per cent to a new high of ₹12.43-lakh crore.

Venkat Chalasani, Chief Executive, AMFI, said the sharp rise in inflows despite the RBI data showing a steady fall in household savings highlights investors’ confidence in the mutual fund industry and using it as means for their long-term savings.

In fact, the equity asset at ₹27.68-lakh crore accounts for 45 per cent of the overall industry AUM and this is close to the global average of 48 per cent, he said.

Gopal Kavalireddi, Vice-President of Research at FYERS, said with valuations stretched and some sectors appearing expensive, investors should consider being more cautious with fresh direct equity investments, especially with the upcoming Union Budget.

“Due to valuation concerns and the challenge of deploying funds at high prices, AMCs have had to restrict the flow of lump-sum investments into certain schemes,” he added.

Akhil Chaturvedi, Chief Business Officer, Motilal Oswal AMC, said investors shrugged off volatility amid election results and used the fall in market to add fresh exposures.

With Budget around the corner, investors continue to be positive on their investments and are using short-term volatility for long- term wealth creation, he added.

Ashwini Kumar, Head Market Data, ICRA Analytics, said the net AUM increased 38 per cent in June against ₹44.39-lakh crore in June last year amid hopes of political stability and policy continuity. .