Net Inflows Fall Over 40% In August; Equity Schemes See Marginal Rise

Net flows into mutual funds fell 42.8% in August led by a decline in debt oriented schemes. The total recorded an inflow of Rs 1.08 lakh crore against an inflow of Rs 1.89 lakh crore in July.

Inflows into equity mutual funds increased during the month after a decline in July, led by a rise in the inflows into sectoral and thematic funds.

Equity inflows increased 3% to Rs 38,239.16 crore last month against Rs 37,113.4 crore in July, according to data released by the Association of Mutual Funds in India on Tuesday.

The largest category by assets under management continues to be sectoral and thematic funds with and an AUM of Rs 4.45 lakh crore. While flows into the category declined marginally month on month, they contributed 47% flows into actively managed equity funds. This category saw inflow worth of Rs 18,117.18 crore.

Small-cap funds logged inflows of Rs 3,209.3 crore during the month under review, compared to Rs 2,109.2 crore last month. Mid-cap schemes attracted investments of Rs 3,054.68 crore, against Rs 1,644.2 crore in July. Flexi cap funds saw an inflow Rs 3,513.16 crore in the month of August.

Inflows into large-cap funds rose to Rs 2,636.9 crore during August, compared with Rs 670.1 crore in the previous month. Multi-cap funds had inflows of Rs 2,475.06 crore, against Rs 7,084.6 crore in the previous month.

Index funds category also saw significant increase in inflows with Rs 3,247.2 crore. The other ETF category drove the inflow with Rs 10,093.5 crore.

New Fund Offers bring more than 50% of inflows into the industry. NFOs have brought Rs 13,815 crore inflow into the industry with NFOs in the sectoral thematic category accounting for Rs 10,202 crore.

Overall, the systematic investment plan continued to reach new peaks with Rs 23,547.34 crore of inflows in August, as against a contribution of Rs 23,322 crore in the previous month.

Liquid funds recorded an inflow of Rs 13,594.87 crore during the month under review, as opposed to the around Rs 70,060.9 crore outflow in July.

Credit-risk funds saw outflow of Rs 390.41 crore in August, as opposed to Rs 542.8 crore being pulled out of the schemes in July.

Total inflow into debt-oriented funds stood at approximately Rs 45,169 crore in August, against an inflow of Rs 1.19 lakh crore in the month before.

The debt funds have increased by 3.6%, reaching an all time high. Overnight debt funds drove this inflow by contributing Rs 15,105.9 crore into the category. This increased inflow into the category is attributed to improved liquidity of the market. Specifically the surplus liquidity in the banking system because of increased government spending.

Overall inflows into mutual funds stood at Rs 1.08 lakh crore during August, compared with 1.89 lakh crore during July.

Net assets under management increased to Rs 66.7 lakh crore in August from Rs 65 lakh crore in July.

Correction: In inflows figures of some categories.