Equity MF inflows decline 16% but SIP inflows cross ₹20,000 crore for first time

Equity mutual funds saw a decline of 16% in net inflows in April, with the number falling from ₹22,633 crore in March 2024 to ₹18,917 crore. Average assets under management (AAUM) for equity mutual funds for the month stood at ₹24.21 lakh crore.

All categories of equity mutual funds except Value/Contra and ELSS witnessed net inflows. Net inflows remained the highest for sectoral/thematic funds (over ₹5,000 crore) followed by multi-cap, large and mid and small cap funds, which saw net inflows between ₹2,000 and ₹3,000 crore.

Meanwhile, income/debt categories witnessed net inflows to the tune of nearly ₹1.89 lakh crore, with AAUM rising to ₹14.58 lakh crore. Liquid funds accounted for more than half the net inflows into debt funds, with net inflows into the category being ₹1.02 lakh crore. Liquid funds often witness inflows in the month of April, as companies often withdraw money in March to prepare for corporate tax payments, parking them back next month if the money is no longer needed.

However, outflows were seen in medium term funds, credit risk funds and banking and PSU funds.

The overall AAUM for debt mutual funds stood ₹14.8 lakh crore.

The rest of the ₹57 lakh crore mutual fund industry assets are made up of hybrid schemes (₹7.77 lakh crore), schemes such as index funds and ETFs (₹9.48 lakh crore) and others such as closed-ended schemes.

While equity mutual funds saw a decrease in net inflows, it is worth noting that systematic investment plans (SIP) achieved a new milestone. According to the monthly SIP data, the SIP book increased from ₹19,271 crore in March to ₹20,371 crore in April. This is the first time that the monthly SIP contributions surpassed ₹20,000 crore.

SIPs have risen steadily since the COVID crash, rising from an average of ₹7,000-8,000 crore inflows per month pre-COVID to over ₹20,000 crore now.