Inflows into equity and equity-oriented mutual fund (MF) schemes continued to be low for the second consecutive month, but inflows into systematic investment plans (SIPs) remained strong and touched over Rs 10,000 crore for the first time, indicating the rising interest of new-age investors in equities.
"The good news on the SIP front continues with the monthly input value finally crossing Rs 10,000 crore in September. This is heartening as this is a significant jump from the Rs 8,000 crore the SIP book had shrunk to, a year back. This clearly highlights the improving appetite from retail as well as high net worth individuals (HNIs)," said Aashwin Dugal, Co-Chief Business Officer, Nippon India Mutual Fund.
“As the stock markets continue to grow, the flexi-cap category continues to do well as investors prefer a category that allows fund managers flexibility across market caps. This is understandable as investors may be wary of exposure to any one category, given the record-breaking run of the markets," he added.
SIP inflows came in at Rs 10,351 crore in September, compared to Rs 9,923 crore in August 2021.
“Inflows into equity funds (ex-NFOs) remained low for a second consecutive month at Rs 2,100 crore in September 2021, against Rs 1,800 crore in August and Rs 6,000-9,000 crore since March 2021. New fund offer (NFO) inflows during September were at Rs 6,579 crore against Rs 6,863 crore in August," said ICICI Direct.
The benchmark indices continued to run ahead of fundamentals, hitting fresh highs on the hope that corporate earnings and economic growth is expected to be strong in the coming quarters, which is also backed by a slew of measures or initiatives taken by the government to boost growth and improve sentiment. As a result, experts expect the momentum to continue in the coming years, with participation from every sector.
The BSE Sensex and Nifty50 gained nearly 3 percent each in September, extending the rally in October to cross the 60,700 mark and 18,100 levels, respectively. The broader markets also traded at record high levels, with the Nifty Midcap100 and Smallcap100 indices gaining 6-7 per cent in September and 13-14 per cent so far from September.
“With the stock markets hitting lifetime high and expected to do well in the foreseeable future, on the back of expected double-digit growth in GDP and the bullish business sentiment displayed by the capex plans of the private sector, it is not surprising that MFs in India registered positive inflows in equity funds," said Waqar Navqi, CEO, Taurus Mutual Fund.
“The expected return from equity remains higher than debt funds, with a pause in reduction of interest rates by the RBI due to increased CPI inflation, among other reasons. Investors obviously see a better risk-return ratio by investing in equity funds and the churn is inevitable," he said.
ICICI Direct collated a list of 10 stocks each from the large-cap, mid-cap, and small-cap categories, which saw highest buying and selling in September 2021.
In September, the highest buying by asset management companies (AMCs) was seen in HDFC Asset Management Company, Piramal Enterprises, Adani Enterprises, Interglobe Aviation, and SBI Card.
However, stocks like Yes Bank, Indus Towers, HDFC Life Insurance, Bharti Airtel, and Adani Green Energy witnessed highest selling by mutual funds during the month.
In the mid-cap space, Vodafone Idea, Max Healthcare Institute, Canara Bank, L&T Finance Holdings and GMR Infrastructure saw the maximum buying by AMCs in September 2021.
Indian Railway Catering and Tourism Corporation (IRCTC), Sun TV Network, Dr Lal Pathlabs, Nippon Life India Asset Management and Linde India are the top five stocks which saw maximum selling by mutual funds.
Among small-caps, the maximum buying by AMCs was seen in Kolte-Patil Developers, PTC India, Action Construction Equipment, Arvind Fashions, and India Glycols.
However, Gujarat Narmada Valley Fertilizers & Chemicals, Laxmi Organic Industries, Granules India, Railtel Corporation of India, and Easy Trip Planners saw the highest selling by AMCs in September.
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