Equity MF Inflows Surge 14% in Dec, Small & Mid-Cap Funds Hit Record Highs

Mumbai, Jan 9 (PTI) Inflows into mutual funds' equity schemes increased by over 14 per cent on-month to Rs 41,156 crore in December, even as market volatilities continued.

The small and midcap schemes of mutual funds continued to attract investor interest with inflows touching record highs during the month, despite the concerns being expressed about the two segments for the risk they portend, industry body Amfi said.

Inflows into systematic investment plans came at Rs 26,459 crore, up from November's Rs 25,320 crore. The SIP assets under management stood at Rs 13.63 lakh crore, which is around a fifth of the overall.

The overall assets under management of mutual funds came at Rs 66.93 lakh crore as on December 31, 2024, which was down from Rs 68.08 lakh crore in the month-ago period.

Venkat Chalasani, chief executive of the Association of Mutual Funds of India (Amfi), attributed the decline to mark-to-market losses on corrections as well as outflows of Rs 1.27 lakh crore in debt schemes, which is in line with previous experience of a pull out at the end of a quarter.

Responding to a question on the continued interest in equity funds and what to expect in the future, Chalasani acknowledged that there are uncertainties which may influence the market, like the change in the US administration with Donald Trump as the President in January, but added that Indian investors continued to repose faith in the equity market.

Pointing to the continued interest in SIPs, Chalasani said these inflows illustrate the optimism of the investors in the Indian markets over a long term.

Asset management companies launched a total of 33 new fund offers during the month through which over Rs 13,643 crore of money was mobilised, Amfi said, adding that this was higher than the 18 schemes that collected over Rs 4,000 crore in November.

"Culmination of NFOs, SIPs and lump sum purchase led to an increase in net sales numbers. Investor confidence on mutual funds are an efficient tool for investments continue to remain strong," Kotak Mahindra AMC's national head for sales, marketing and digital business Manish Mehta said.

Within the equity schemes, sectoral or thematic category attracted investors with the highest net inflow at Rs 15,331 crore, which is almost double of the Rs 7,658 crore in November.

The midcap category saw inflows of Rs 5,093 crore in December 2024, while the smallcap category saw inflows of Rs 4,667 crore, Amfi said, adding that these are record inflows.

The large schemes, which are being recommended by a slew of watchers as a safer bet, saw inflows decline to Rs 2,010 crore in December from over Rs 2,500 crore in November, while the large and midcap category saw Rs 3,811 crore, the Amfi data said.

Gold exchange traded funds continued to witness lackluster inflows for the seventh consecutive month at Rs 640 crore, Chalasani said.