Equity mutual fund inflows halve in May; SIP contributions hit record: Data

Inflows into Indian equity mutual funds halved sequentially to Rs 3,240 crore in May, the lowest since November 2022, data from the Association of Mutual Funds in India (AMFI) showed on Friday.

Equity mutual fund inflows had fallen to a five-month low of Rs 6,480 crore in April.

The slide in equity mutual fund inflows was offset by steady foreign inflows in domestic equities, prompting a 2.60% rise in the Nifty 50 index in May.

Contributions through systematic investment plans (SIPs) - in which investors make regular payments into mutual funds - rose 7.44% from the previous month to a record Rs 147,49 crore in May. Over 1.05 million new SIP accounts were opened last month.

"More working days in May and the preference of retail investors to utilise mutual funds to invest in equity markets propelled SIPs to record highs," said AMFI Chief Executive NS Venkatesh.

"The rotation of money into small-caps which are expected to rise after a steep correction and profit booking with index nearing record levels triggered moderation in large-caps, midcaps and multicaps," Venkatesh added.

Among equity-oriented schemes, small-cap funds accounted for most of the investments for the eighth straight month at a record high of Rs 3,283 crore, in contrast to outflows worth Rs1,362 crore from large-cap funds, AMFI data showed.

Equity-oriented mutual fund schemes have seen net inflows for 27 months in a row since February 2021.

The mutual fund industry, including debt, equity, hybrid and other schemes, saw net inflows fall 53% to Rs 57,420 crore, AMFI data showed.

The average assets under management rose to Rs 42.94 trillion from Rs 41.53 trillion in April.