While debt mutual funds saw outflows, a buoyant equity market and pick-up in retail participation helped the industry’s net assets under management (AUM) scale to a new all-time high of ₹74.41 lakh crore in June, up from ₹72.20 lakh crore in May.
The reversal comes after inflows had steadily fallen from ₹39,688 crore in January to ₹19,013 crore in May. It was the 52nd consecutive month of flows into equity schemes since March 2021.
AgenciesRecord SIPs
Systematic Investment Plans (SIPs) remained a major driver of retail flows into equity funds. SIP contributions rose to a record ₹27,269 crore in June, up 2.2% from ₹26,688 crore in May. The number of contributing SIP accounts increased from 8.56 crore in May to 8.64 crore in June.
SIP AUM stood at ₹15.31 lakh crore in June, accounting for 20.6% of the industry’s total assets, higher than 20.2% in May. A total of 61,91,178 new SIPs were registered during the month.
Investor sentiment remained positive despite global uncertainties, with market gains helping equity flows. The NSE’s Nifty gained 2.7% and the BSE’s Sensex rose 3.1% in June.
New Fund Offers (NFOs) also aided inflows in equity funds. NFOs raised ₹1,986 crore across 20 new open-ended schemes in June.
In the equity category, flexi cap funds registered highest inflows of ₹5,733 crore, followed by small cap funds that recorded inflows of ₹4,024 crore.
Total mutual fund folios climbed to 24.13 crore as of June, reflecting continued investor interest. Retail mutual fund folios (equity, hybrid and solution-oriented schemes) rose to 19.07 crore in June from 18.84 crore in May, while retail AUM grew to ₹43.99 lakh crore from ₹42.20 lakh crore a month earlier.
Hybrids
Arbitrage funds contributed ₹15,584.57 crore – the most among hybrid-based funds – though inflows were marginally lower compared with May. The inflows in multi-asset allocation funds that invest in equity, debt and gold grew 9.7% to ₹3,209.9 crore in June.
In June, Gold ETFs witnessed inflows of ₹2,080 crore, up 613% from ₹292 crore recorded a month ago.
“Almost a 10 times jump in gold ETF inflows suggests investor desire to diversify their asset allocations in an uncertain global environment and hedge against any global volatility,” said Sumit Bhatnagar, Fund Manager – Equity at LIC MF.
Debt Funds
Debt mutual funds recorded net outflows of ₹1,711 crore in June, with liquid funds recording the most outflows.
Liquid Funds saw the highest outflows at ₹25,196 crore, largely driven by corporate advance tax payments, though this was 37% lower than May outflow of ₹40,205 crore. Overnight Funds also remained negative with ₹8,154 crore in outflows.
While the debt segment largely remains influenced by liquidity and rate expectations, shorter-duration funds benefited from investor preference for relatively safer avenues amid interest rate uncertainties. Ultra Short Duration Funds grew 59% to ₹2,944 crore. Short Duration Funds jumped 474% to ₹10,277 crore from ₹1,790 crore in May.
