Inflows into equity MFs dip on profit-booking in June

Suresh P Iyengar Mumbai | Updated on July 08, 2021

Inflows were down 41 per cent to ₹5,988 crore in June against ₹10,083 crore logged in May.

Inflow into equity mutual fund schemes dipped last month as investors book profit as markets touched a new high.

Net inflow into equity schemes was down 41 per cent to ₹5,988 crore in June against ₹10,083 crore logged in May as investors pulled out ₹792 crore and ₹110 crore from ELSS (equity-linked saving schemes) and value funds.

However, all other categories of equity schemes registered inflows with mid-cap and sectoral funds attracting investment of ₹1,729 crore and ₹1,207 crore, while flexi-cap recorded an inflow of ₹1,087 crore.

Himanshu Srivastava, Associate Director, Morningstar India, said that though the inflow is lower month-on-month, it is still sizeable considering that the equity segment witnessed net outflows for eight consecutive months before March.

Significant improvement on Covid situation and upbeat corporate earnings outlook over the long-term has alleviated concerns of any severe impact of the second wave of the pandemic on the economy, he added.

Hybrid funds saw an inflow of ₹12,361 crore, led mainly by an inflow of ₹9,059 crore in arbitrage funds, while dynamic asset allocation funds attracted an investment of ₹2,057 crore.

Akhil Chaturvedi, Head (Sales & Distribution), Motilal Oswal AMC, said the prime objective of the asset allocation funds is to use valuation models and dynamically rebalance portfolio between equities and fixed income, ensuring better risk-adjusted returns for investors.

The debt category recorded a net inflow of ₹3,566 crore with a floater and low duration funds, attracting investment of ₹6,318 crore and ₹6,273 crore even as the money market funds logged a net outflow of ₹13,988 crore.

Investments through systematic investment touched ₹9,155 crore against ₹8,818 crore in May and asset under management of SIP was at ₹4.83 lakh crore.

The number of unique investors identified through PAN number doubled to 2.39 crore against 1.19 crore in 2017. The industry added 12 lakh new investors in the June quarter.

NS Venkatesh, Chief Executive, AMFI, said several SIPs registered last month was at a record high of 21.29 lakh and breached the four crore mark for the first time ever.

Moreover, he added SIP AUM touched an all-time high, accounting for almost 15 per cent of the industry, reflecting retail investor confidence in the mutual fund as an asset class.


Published on July 08, 2021

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