By Siddhant Mishra
Inflows into equities schemes recorded a three-fold jump in December, compared with November, data released by the Association of Mutual Funds in India (AMFI) on Tuesday showed. However, debt schemes witnessed a surge in outflows, at close to `21,947 crore, with the major hit coming from the Rs13,852-crore withdrawal from liquid funds, largely due to the quarter-end as corporates withdraw money to pay advance tax.
The equity segment witnessed net inflows of Rs 7,303 crore, compared with Rs 2,258 crore in November, boosted by strong inflows of Rs 2,244 crore and Rs1,962 crore into smallcap and midcap funds, respectively. This was despite the massive correction witnessed in the markets in December. The largecap category saw marginal outflows of `26 crore.
Interestingly, sectoral/thematic funds saw outflows of over Rs 203 crore, despite having recorded inflows of close to `1,380 crore in November.
The contribution towards systematic investment plans (SIPs) increased by Rs 266.6 crore month-on-month to Rs 13,573 crore. SIP AUM stood at Rs 6.74 trillion for December. Overall, the average assets under management stood at ` 40.76 trillion, against Rs 40.49 trillion in November. Net AUM fell to Rs 39.88 trillion versus Rs 40.37 trillion in November.
NS Venkatesh, chief executive of AMFI, said investors will continue investing in the India growth story through the MF route, in the near future.
“Investors are looking forward to a growth-oriented Budget that should have a positive impact on the markets. The importance of investing in equity markets for long-term goals has not been lost on investors, and the same is being reflected in the ever-increasing awareness and adoption of SIPs as a goal-linked route to create wealth over the long term,” said Venkatesh.
He highlighted that almost 2.4 million new SIPs were registered in December, showing an increasing investor belief in the instrument.
“Equity funds witnessed net inflows of Rs 7,303 crore, with categories like smallcap and midcap witnessing the largest net inflows. The large and midcap category also witnessed significant flows. Interestingly, largecap, dividend yield, focused funds, ELSS, and flexi-cap categories witnessed outflows. We’ve also witnessed a positive flow from FIIs during December, which has likely led to the increased inflows,” said Kavitha Krishnan, senior analyst (manager research), Morningstar India.
Only the ultra-short duration and long-duration funds registered inflows, with every other category among the debt schemes registering outflows.
Index funds saw inflows Rs 6,736.5 crore, compared to Rs 8,601.7 crore in November. However, outflows from gold ETFs increased from Rs195 crore to Rs 273 crore.
MF folios were at an all-time high of over 141 million, and retail MF folios were also at an all-time high of almost 113 million.
Venkatesh said the rise in equity MFs proved equities are the preferred class for investment.