Fresh investment in equity mutual funds has dipped 22 per cent last month to ₹19,013 against ₹24,269 crore in April as investors preferred to book profit with market rallied.

Given the economic uncertainty, investors preferred hybrid funds over equity funds. The inflows into hybrid funds were up at ₹19,013 crore (₹14,248 crore).

Arbitrage funds registered the highest inflow of ₹15,702 crore (₹11,790 crore), followed by multi-asset funds at ₹2,927 crore (₹2,106 crore), while dynamic asset allocation recorded fresh investment of ₹1,136 crore (₹881 crore).

Among equity funds, flexi and small cap registered highest inflow of ₹3,841 crore and ₹3,214 crore. Multi and mid-cap funds also received healthy inflow of ₹2,999 crore and ₹2,809 crore.

Overall equity asset increased to ₹32.05 lakh crore (₹30.58 lakh crore) largely due to mark-to-market gain of ₹1.28 lakh crore.

Inflows through Systematic Investment Plan hit a new high of ₹26,688 crore last month against ₹26,632 crore logged in April, with the number of contributing accounts increasing to 8.56 crore (8.38 crore).

The industry opened 59 lahk (46 lahk) of new SIP accounts and closed 43 lahk (1.62 crore) last month.

Himanshu Srivastava, Associate Director—Manager Research, Morningstar Investment Research India, said the broader slowdown in equity inflows can be attributed to concerns around global economic headwinds and a possible profit booking in domestic equities following sharp rallies in the previous months amid stretched valuations.

Also, heightened global volatility—stemming from geopolitical tensions with India launching Operation Sindoor against Pakistan and concerns around global inflation, contributed to a risk-off sentiment among some investors, he added.

Published on June 10, 2025