Investor confidence in mutual fund schemes has remained strong during a period of downward-biased volatility in both the Nifty-50 and Sensex.
Mutual fund schemes’ net assets under management reached a new high of Rs 68 lakh crore. Every month, however, equity inflows in November decreased by 14% to Rs 35,943.49 crore. This decline was the largest in the previous seven months. During the month, the Nifty and Sensex returned (-)0.31% and 0.52%, respectively, showing no change.
The main driver was still the SIP (systematic investment plan) book, which brought in Rs 25,319.66 crore, which was somewhat less than the Rs 25,322.74 crore it brought in in October. SIP inflows exceeded Rs 25,000 crore for the second consecutive month.
The number of SIP accounts increased to 102.3 million, a new record, from 101.2 million in October. Nonetheless, 49,46,408 new SIPs were registered during the month, down from 63,69,919 in October.
Although monthly equity inflows decreased overall, there was a positive trend for small-cap and mid-cap funds, with inflows rising by 9% and 4.3%, respectively. On the other hand, sectoral, thematic, and large-cap funds saw monthly drops of about 26.20% and 37.63%, respectively.
Thematic funds saw the largest inflow of Rs 7,657 crore despite the decline, followed by flexi cap funds at Rs 5,084 crore.
In the case of debt, inflows also fell precipitously. Inflows in November totaled Rs 12,915 crore, a sharp decrease from October’s inflows of Rs 1.57 lakh crore. Inflows into hybrid mutual funds also fell, falling 75.5% to Rs 4,123 crore.
Due to profit booking and pressure on long-term bond yields from state-owned banks and insurance firms, the debt category saw large redemptions in long-duration funds, including medium-duration, long-duration, and gilt funds.
