Mutual fund trends: Equity inflows jump 56% to Rs 40,450 crore in March; SIPs hit record high

Equity mutual funds saw net inflows surge 56% to Rs 40,450 crore in March, reflecting strong investor participation despite market volatility and geopolitical tensions, PTI reported. The inflow was the highest since July 2025, when equity-oriented funds had attracted Rs 42,702 crore. According to data from the Association of Mutual Funds in India (AMFI), this also marked the 61st consecutive month of positive net inflows into equity schemes. "The surge in inflows reflects sustained retail engagement through SIP contributions, year-end portfolio allocations, and investors using recent market corrections as an opportunity to deploy incremental capital into equities," Himanshu Srivastava of Morningstar Investment Research India said. Monthly SIP contributions rose to an all-time high of Rs 32,087 crore in March, up from Rs 29,845 crore in February, indicating continued preference for disciplined investing. Umesh Sharma of The Wealth Company Mutual said inflows increased following market corrections triggered by the West Asia conflict, which created more attractive investment opportunities. Within equity categories, Flexi Cap funds led with inflows of over Rs 10,000 crore, followed by Small Cap funds at Rs 6,263 crore and Mid Cap funds at Rs 6,063 crore. However, Dividend Yield and Equity Linked Savings Scheme (ELSS) funds saw marginal outflows due to profit booking and portfolio rebalancing. Venkat Chalasani, CEO of AMFI, said the trend reflects sustained investor confidence in long-term wealth creation. "India's structural growth story remains strong, and investors continue to align their investments with long-term financial goals". Despite strong equity inflows, the overall mutual fund industry recorded a net outflow of Rs 2.4 lakh crore in March, compared to an inflow of Rs 94,530 crore in February, largely due to a sharp Rs 2.95 lakh crore outflow from debt funds. March typically sees higher redemptions from debt schemes as companies withdraw funds to meet year-end obligations. "The net outflow is almost entirely driven by debt fund redemptions, which is a well-established quarter-end phenomenon in March," said Nitin Agrawal, CEO, Mutual Funds, InCred Money. The outflows reduced the industry’s assets under management (AUM) to Rs 73.73 lakh crore at the end of March, from Rs 82.03 lakh crore in February. Hybrid schemes also saw net outflows of nearly Rs 16,500 crore, mainly from Arbitrage Funds, which alone recorded outflows of Rs 21,000 crore. In contrast, Multi-Asset Allocation Funds attracted inflows of over Rs 5,000 crore. Gold exchange-traded funds (ETFs) received inflows of Rs 2,266 crore in March, lower than Rs 5,255 crore in February and Rs 24,040 crore in January, though investor interest remained positive. "The slower inflows in March likely reflect a combination of normalization after a very strong start to the year and some moderation in fresh allocations," said Nehal Meshram of Morningstar Investment Research India. Debt fund outflows were led by Liquid Funds at Rs 1.35 lakh crore, followed by Overnight Funds at Rs 40,228 crore, Money Market Funds at Rs 29,207 crore, and Low Duration Funds at Rs 25,227 crore. Ankur Punj of Equirus Wealth said the outflow is temporary and inflows are likely to pick up again in the coming months, supported by India’s strong macroeconomic fundamentals and favourable equity valuations.

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