Year 2023 began on a good note for the domestic mutual fund industry as inflows into equity schemes jumped almost 72 per cent in January over the previous month despite the volatility in the stock markets.
Data released by the Association of Mutual Funds in India (Amfi) showed the infusion at Rs 12,546 crore against Rs 7,303 crore in December.
This is the highest net inflow in four months. Prior to that, equity mutual funds witnessed inflows to the tune of Rs 14,100 crore in September. This was also the 23rd straight month of inflows into equity-oriented schemes.
The strong numbers came as retail investors continued to repose their faith in systematic investment plans (SIPs). According to the data, inflows through SIP rose to Rs 13,856 crore in January from Rs 13,573 crore in December. This was the fourth consecutive month when SIP inflows remained above the Rs 13,000- crore mark.
“Despite volatile market conditions, SIP flow continues to be encouraging as investors see merit in the long-term benefits of SIPs. Investors seem to be maintaining their asset allocation of adding funds on dips. This is also a reflection of the excellent work done by mutual fund distributors and industry to promote disciplined investment,’’ said Manish Mehta, head — sales, marketing and digital business, Kotak Mahindra Asset Management Company.
Among various categories, hybrid funds continue to show a positive trend with a net flow doubling to Rs 4,492 crore in January while multi-asset and arbitrage funds saw net flows of Rs 2,182 crore and Rs 2,055 crore, respectively. Further, index fund saw inflows of Rs 5,813 crore in the month.
However, debt-oriented mutual fund schemes saw net outflow of Rs 10,316 crore during the month compared with Rs 21,947 crore in December 2022. Within the debt funds, liquid funds category has seen highest outflow at Rs 5,042 crore, while money market funds have witnessed an inflow of Rs 6,460 crore.
The mutual fund industry assets under management was marginally down to Rs 39.62 lakh crore in January-end from Rs 39.89 lakh crore in December-end. Of this, equity AUM stood at Rs 15.06 lakh crore and debt AUM at Rs 12.38 lakh crore.