Despite a highly volatile stock market environment and continued selling by foreign portfolio investors, equity mutual funds attracted a higher net inflow of Rs 19,705 crore in February as against an inflow of Rs 14,888 crore in January.
The Association of Mutual Funds in India (Amfi) said the mutual fund industry registered an overall net inflow of Rs 31,533 crore in the month of February, compared with a net inflow of Rs 35,252 crore in the preceding month. Equity funds had received Rs 25,077 crore in December 2021.
The benchmark Sensex had fallen three per cent in February as the Russian invasion of Ukraine and rising crude oil prices hit the market sentiment.
While SIP accounts stood at 5.17 crore, the total amount collected through SIPs during February 2022 amounted to Rs 11,438 crore as against Rs 11,517 crore in January.
The debt segment saw a net withdrawal of Rs 8,274 crore in February after witnessing a net inflow of Rs 5,088 crore in January. Liquid funds got Rs 40,273 crore during the month. The assets under management (AUM) of the industry slightly went down to Rs 37.56 lakh crore at the end of February from Rs 38.01 lakh crore at January end.
Within the equity segment, all categories saw net inflows. While the flexi-cap fund category saw the highest net inflow of Rs 3,873 crore, followed by thematic funds at Rs 3,441 crore during the period under review. While hybrid funds recorded an inflow of Rs 3,176 crore in January, index funds and ETFs registered inflows of Rs 16,521 crore.
AMFI Chief Executive NS Venkatesh said the inflow into the equity market is a hugely positive sign despite the marginal drop and it did not account for much other than being a reflection of the fall in mark-to-market values. “The outflow in income/ debt funds is a reflection of the current market dynamics, the ongoing interest rate scenario in the market and the geopolitical tensions between Russia and Ukraine,” he said.
“This is clearly change of attitude of investors towards this asset class and a definitely a positive change. At this stage, net domestic positive flows are supporting the massive outflows by FPIs on a daily basis. A large part of the positive flows is also due to the strong SIP flow of Rs11,000 crore monthly which continues to grow strongly,” said Akhil Chaturvedi, Chief Business Officer, Motilal Oswal AMC.