Equity mutual fund inflows dip by 50% in June; debt MFs recover

Equity inflows saw a downward trend in the month of June. The AMFI data shows that the inflows in equity funds are down by 50% on a month on month basis. Debt funds on the other hand saw inflows getting out of the negative territory. Debt fund net inflows stood at Rs 3,566 crore in June. Equity fund net inflows were at Rs 5,988 crore in June.

Small cap funds saw a huge decline in inflows last month. This can be attributed to the rise in profit booking due to immense surge in small cap stocks. Small cap funds saw a net inflow of Rs 705 crores in June compared to Rs 1,080 crore in May. Apart from mid cap funds, all other categories like large caps, multi caps and ELSSs saw sharp decline in inflows in the month of June. Here's a look at the numbers:

On the debt front, floater funds emerged as clear winners with inflows worth Rs 6,318 crore in June. Floater funds have been in demand because of the uncertain rate scenario in the system. Many mutual fund advisors have been asking investors to look at floater funds as returns from liquid and overnight funds decline. Other categories that saw a good inflow in the month of June are low duration funds and banking & PSU funds. Here's a look at the overall inflows:

Among the hybrid category, the aggressive hybrid funds and balanced hybrid funds saw net outflows this month. Balanced advantage funds were ahead of many other categories in terms of the money pumped by retail investors in the month of June. These schemes have been the favourites of fund managers of late. Arbitrage funds saw a massive jump of around 50% in the month of June. Here's a look at the numbers from hybrid categories:

The passive funds including ETFs and index funds saw a rise in AUM in the month of June.

"The Mutual Fund industry is witnessing sharp rise in the number of new investors, which has doubled in last four years to 2.39 crores unique investors. Many new investors are seen embracing mutual funds through the SIP route, over other traditional investment avenues," said NS Venkatesh, Chief Executive, AMFI.

Venkatesh added, "Coming to the monthly numbers, I am happy that Indian MF Industry has progressed quite sharply in the first quarter of FY22, be it on overall Net Flows, including equity, debt or hybrid, which have been positive, or on new SIPs registered which have seen sharp rise, with June 2021 reporting record 21.29 lakh new SIP registrations. SIP AUM at an all-time high and now forming almost 15 per cent of total industry AUMs and number of SIP accounts breaching 4 crore mark for the first time ever, is reflective of continued retail investor confidence in the mutual fund asset class.”