Equity mutual funds witnessed a net inflow of Rs 3,437 crore in April, making it the second consecutive monthly infusion. However, this was much lower than an inflow of Rs 9,115 crore seen in March, data from the Association of Mutual Funds in India showed on Tuesday.
Prior to this, equity schemes had consistently witnessed outflow for eight straight months from July 2020 to February 2021.
Apart from equities, investors infused over Rs 1 lakh crore in debt mutual funds last month after withdrawing Rs 52,528 crore in March.
Overall, the mutual fund industry witnessed an inflow of Rs 92,906 crore across all segments during the period under review, compared to an outflow of Rs 29,745 crore in March, PTI said.
As per the data, inflow from equity and equity-linked open ended schemes was at Rs 3,437.37 crore in April.
Barring multi cap, dividend yield, value fund and thematic fund categories, all the equity schemes have seen inflow last month.
Overall, equity schemes had witnessed an outflow of Rs 9,253 crore in January, Rs 10,147 crore in December, Rs 12,917 crore in November, Rs 2,725 crore in October, Rs 734 crore in September, Rs 4,000 crore in August and Rs 2,480 crore in July, which was their first withdrawal in over four years.
Prior to this, such schemes had attracted Rs 240.55 crore in June.
Further, gold exchange traded funds (ETFs) witnessed net inflow of Rs 680 crore last month, compared to Rs 662 crore in March.
The asset under management (AUM) of the mutual fund industry rose to Rs 32.38 lakh crore in April-end from Rs 31.43 lakh crore in March-end
Akhil Chaturvedi, Head of Sales & Distribution, Motilal Oswal Asset Management Company, said, "In the wake of second wave, we have seen FII turning net sellers and DII turning Net buyers. This trend is quite interesting that domestic investors are showing faith in in Indian equities in such times and would benefit from allocations at attractive valuations.
"Mutual funds have witnessed lower redemptions and stable gross flows resulting in positive net sales of 3,400 crore, this is very healthy sign being second month of positive net sales and probably bottoming of negative sales cycle. It’s particularly quite pleasing to note that investors are buying dynamic funds more aggressively and rightly recommended by MFD’s in these times of volatility," he added.
Aashish P Somaiyaa, Chief Executive Officer - White Oak Capital, said, "There is a significant decline in gross inflows in the month of April while quantum of redemption has remained same as last month, whereby the net flows have declined. This is also palpable from the circumspect market activity one has been witnessing ever since the second wave has emerged. Any correction could result in significant inflows as there are potential investors on the fence.
"The interesting trend of money being allocated to relatively newer categories like international funds and domestic index funds continues to gain traction. As market performance and corporate performance broadens it will be interesting to watch for sustainability of this trend vis-à-vis domestic active equity funds,” said Somaiyaa.
