MF assets hit record level of over Rs 32 lakhcrore in April


MUMBAI: Strong inflows across a mix of fund categories took the total assets of the mutual fund (MF) industry to a record high of Rs 32.4 lakh crore at the end of April. The month’s inflow through the systematic investment plan (SIP) route also remained at an elevated level at Rs 8,591 crore. This compares with the all-time high Rs 9,182 crore in March, and Rs 7,528 crore in February, data from industry trade body Amfi showed.
The net inflow for the month was about Rs 92,900 crore. This was also the second consecutive month of net inflows through equity funds, indicating renewed retail investor interest, industry players said. “The flows during April 2021 were driven by liquid, overnight and money market schemes on the fixed income (debt) side, thematic/sectoral schemes in the equity segment, while arbitrage and dynamic asset allocation schemes ruled in the hybrid segments” of the fund industry, Amfi chief executive N S Venkatesh said.
According to data released by Amfi, among the debt schemes, liquid funds recorded a net inflow of about Rs 41,500 crore, overnight funds nearly Rs 18,500 crore and money market schemes close to Rs 20,300 crore. On the equity side, thematic/sectoral schemes pulled in about Rs 1,700 crore at the net level, while among the hybrid schemes, arbitrage funds saw net inflows of Rs 7,245 crore.
Continuing its strong run, monthly flows through the SIP route remained above Rs 8,500 crore in April. Although the month’s figure was lower than the all-time high recorded in March, which was boosted by spillover of SIP flows from February. Since February was a 28-day month, the SIPs which were to be credited to customer accounts on 29th, 30th and 31th of each month came in to the fund houses in March, industry players explained.
According to Union MF CEO G Pradeepkumar, the SIP numbers have remained robust and the addition of SIP folios also have been very healthy. However, he also expects some slowdown in fund flows till the Covid’s second wave recedes. “We expect the flows to pick up pace once the pandemic is brought under control through increased levels of vaccination and other measures.”
April’s net inflow data by mutual funds was in line with the current trend of net buying in the Indian market by domestic funds, while foreign funds have turned net sellers. “This trend is quite interesting that domestic investors are showing faith in Indian equities in such times and would benefit from allocations at attractive valuations,” said Motilal Oswal MF head (sales and distribution) Akhil Chaturvedi. Equity funds have witnessed lower redemptions and stable gross flows, “resulting in positive net sales of (about) Rs 3,400 crore…this is a very healthy sign being second month of positive net sales and probably bottoming of negative sales cycle”, Chaturvedi said.