Equity mutual fund inflows declined by 22% month-on-month to Rs 33,403 crore in August, compared to Rs 42,702 crore in July, according to data from the Association of Mutual Funds in India (AMFI). The fall came as investors turned cautious following tariff-related developments and global macroeconomic concerns.
On August 27, U.S. President Donald Trump imposed a 50% tariff on Indian exports, dampening investor confidence. Reflecting this sentiment, benchmark indices Sensex and Nifty slipped 1.69% and 1.38% respectively during the month.
The overall assets under management (AUM) of the mutual fund industry fell slightly by 0.22% to Rs 75.19 lakh crore in August from Rs 75.36 lakh crore in July.
SIP Flows Show Minor Dip
Systematic Investment Plan (SIP) inflows also eased marginally to Rs 28,265 crore, compared with a record Rs 28,464 crore in July. The number of active SIP accounts declined to 8.99 crore from 9.11 crore, though SIP AUM stood steady at Rs 15.18 lakh crore.
Fund-Wise Trends
- Small-cap funds: Inflows declined 23% to Rs 4,993 crore from Rs 6,484 crore.
- Mid-cap funds: Inflows rose slightly by 3% to Rs 5,331 crore.
- Large-cap funds: Inflows increased 33% to Rs 2,835 crore from Rs 2,125 crore.
- Sectoral/thematic funds: Saw the steepest fall of 59%, dropping to Rs 3,893 crore from Rs 9,426 crore.
Debt and Hybrid Fund Movements
Debt mutual funds recorded net outflows of Rs 7,980 crore in August, reversing the strong inflows of over Rs 1 lakh crore in July. Liquid funds saw the highest outflows at Rs 13,350 crore, while overnight funds attracted inflows of Rs 4,951 crore.
Hybrid schemes slowed with net inflows of Rs 15,294 crore, compared to Rs 20,879 crore in the previous month.
Gold ETFs Attract Investors
Gold exchange-traded funds (ETFs) remained a bright spot, drawing inflows of Rs 2,190 crore in August, up from Rs 1,256 crore in July, highlighting demand for safe-haven assets.
Expert View
“Although equity flows continued for the 54th consecutive month, the decline reflects global macro concerns. The tariff developments added volatility, making investors adopt a cautious stance,” said Ankur Punj, MD and Business Head, Equirus Wealth.
