Mutual Fund equity schemes see 21.69% spurt in inflows despite market crash in October

“October 2024 has demonstrated the remarkable momentum in India’s mutual fund industry. The 44th consecutive month of positive equity inflows since March 2021 underscores the deepening maturity of Indian investors,” said Venkat Chalasani, chief executive, AMFI.

The MF industry’s assets under management hit an all-time high of Rs 67.26 lakh crore retail folios crossed 17.23 crores. “The continued surge in SIP accounts, now exceeding 10.12 crores, along with a record monthly SIP contribution of Rs 25,322 crore, demonstrates the growing preference for disciplined investing among Indian investors,” Chalasani said.

The strong surge in inflows came despite the fact that the domestic equity markets fell amid a broad-based sell-off across sectors as fears of a full-fledged war between Iran and Israel impacted investors’ risk appetite. Losses were extended as sentiment was dented following muted earnings reported by major domestic companies for the second quarter of FY25 so far. Markets fell further due to persistent selling by foreign portfolio investors in domestic markets and subsequent transfer of funds to China following Beijing’s announcement of various stimulus plans to accelerate economic expansion, said Ashwini Kumar, Senior Vice President and Head Market Data, ICRA Analytics, said.

Among equity mutual funds, inflows into sectoral/thematic funds grew by 215.19 per cent at Rs 12,278 crore. Gold ETFs also witnessed over 133 per cent surge in inflows at Rs 1961 crore in October 2024 as it has been increasingly gaining popularity among investors due to liquidity, transparency and global price alignment, Kumar said.

According to Akhil Chaturvedi, ED & chief business officer, Motilal Oswal AMC, the flows apart from NFO which were healthy at Rs 15,000 crore is also diversified across market cap buckets. “We have seen heightened volatility in markets with FPI selling due to major global events including the US elections. The healthy net flow is a testimonial to the resilience amongst domestic investors to continue investing in equities despite market volatility,” he said.

“The month shows investors have preferred hybrid funds due to the ongoing volatility in the equity markets. We are positive on the Indian economy and India’s equity market will deliver a reasonably good return while comparing with other emerging markets,” said Hitesh Thakkar, Acting CEO, ITI Mutual Fund.

“Trump presidency in US is broadly positive for us. We believe that the market is volatile due to short terms factors like weak domestic earning cycle, delayed government spending for capital intensive sectors etc. However, investors should continue investing in equity mutual funds with 3-5 years’ time horizon,” Thakkar said.