NEW DELHI : Systematic investment plans (SIPs) into mutual funds hit an all-time high in September, crossing the ₹16,000-crore mark for the first time while inflows into small and midcap funds moderated amid sky-high valuations in some stocks. Net inflows into equity mutual funds dipped by 30% while debt fund outflows hit an 18 month high of ₹1.01 trillion, mutual fund body AMFI said Wednesday.
SIPs stood at ₹16,042 crore in September, up from ₹15,814 crore a month ago. Net inflows into equity funds fell 30.39% to ₹14,091.26 crore. Net inflows into small cap funds were down by 37% at ₹2,678.47 crore in September and into midcaps declined by 20% to ₹2,001 crore. Debt equity fund outflows skyrocketed to ₹1.01 trillion, compared to ₹25,873 crore in the previous month.
The dip in the net inflows in mid- and small-cap funds can be attributed to some profit booking by investors coupled with concerns regarding inflated valuations in some of these segments, said Melvyn Santarita, analyst – Manager Research, Morningstar Investment Adviser India.
Debt funds saw heavy outflows, but experts say this was expected. “Outflows normally happen from debt mutual funds during half-year closing as banks have to set aside capital against their investments.
Most banks had parked money in liquid and money market funds as the yield to maturity of liquid and money market are 25 to 50 basis points higher than lending in overnight markets. Corporates tend to withdraw due to salary and other half yearly payouts,” says Murthy Nagarajan, head-fixed income, Tata Asset Management.
Among equity categories, sectoral and thematic funds saw the highest inflows to the tune of ₹3,146 crore during the month. “The spike in the flows of this category could also be attributed to the fact that there were four new fund launches in this category which cumulatively garnered ₹1,629 crore during the month of September.
In August too, this category saw highest net inflows ( ₹4,805 crore) aided by five new fund launches,” pointed out Santarita.
Small cap fund saw net inflows of ₹2,678 crore. Mid cap funds saw net inflows of ₹2,001 crore.
As per the AMFI data, the asset under management (AUM) for the mutual fund industry stood at ₹46.57 trillion as of 30 September.
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Updated: 11 Oct 2023, 09:44 PM IST