Equity mutual funds get close to Rs 20,000 crore net inflow in October: AMFI

In the month of September, inflows into equity funds (Rs14,091 crore) had slowed as compared to the pervious month (Rs 20,245 crore). But October saw investors putting faith in both equity and debt funds

Kayezad E Adajania

November 09, 2023 / 15:37 IST

Investors continued to pour money in mutual funds through SIPs, in October 2023

Not fearing equity market valuation, investors poured money in equity funds in the month of October, , as per data released by Association of Mutual Funds of India (AMFI; the mutual funds' industry trade body). Aside from an increase in net flows across all categories of equity funds, small cap mutual fund (MF) schemes got inflows worth Rs 4,495 crore in October 2023, up from Rs 2,678 crore a month before.

Overall, equity funds got inflows worth Rs 19,957 crore, up from Rs 14,091 crore in September. The month of October saw the third highest monthly inflow into equity funds in the year of 2023. October was also the fourth month where all equity fund categories got positive net inflows (more money came in, than went out).

"It appears that retail investors think there is still juice left in small-cap funds. Yes, some mutual fund houses have stopped or limited inflows in small-cap funds because they have been finding it tough to reply the additional flows into the markets, at these levels. Investors should take caution when investing in small-cap funds. They must do their own due diligence and only then take the decision to invest in small-cap funds at these levels," says N. S. Venkatesh, (outgoing) Chief Executive Executive, AMFI.

Inflows in the Rs 47 trillion Indian Mutual Funds (MF) industry went up in the month of October. Net inflows were Rs 80,586 crore, as opposed to a net outflow (more money went out than came in). Inflows through systematic investment plans (SIP) continue to go up. In October, inflows through SIP were at Rs 16,927.86 crore, up from Rs 16,042 crore, a month before.

Investors also appear to warming up to long-term debt funds, given that interest rates in the economy seem to have peaked. Long-term debt funds got inflows worth Rs 3,656 crore in October. In the month of September, these funds had seen net outflow (more money went out than came in) of Rs 3,972 crore. A closer look at the AMFI data shows that government securities' (g-sec) funds got a staggering net inflow of Rs 2001 crore, up from Rs 278 crore worth of newt inflows a month before. The other long-term category that investors have warmed up to is corporate debt funds, which got net inflow worth Rs 1,940 crore. Even short-term debt funds to net inflows of Rs 1,281 crore, after seeing four successive months of net outflows.