Equity funds received robust inflows of Rs. 6,103 crore in August, primarily due to higher gross sales of Rs. 20,501 crore on the back of rising markets.
Himanshu Vyapak, Deputy CEO, Reliance Mutual Fund said that 50% of these inflows have come through SIPs. He said that arbitrage funds have also received healthy inflows as the spreads have improved. Experts say that arbitrage funds have received net inflows of about Rs. 5,000 crore in August.
The BSE Sensex was up 2% in August and the index has shot up 16% YTD. As a result, the total equity AUM (including balanced, ELSS and ETFs) of the industry increased to Rs. 5.42 lakh crore in August. Equity assets constitute 35% of industry’s total Rs. 15.63 lakh crore assets.
Net inflow/outflow in August
The rally in markets also led to higher redemptions in August. The gross redemptions rose from Rs. 9,516 crore in July to Rs. 14,398 crore in August. But this was offset by higher sales (Rs. 20,501 crore) which helped the industry receive net inflows of Rs. 6,103 crore.
Equity funds clocked gross sales of Rs. 20,501 crore in August as compared to Rs. 11,737 crore in July, a rise of 75%. Interestingly, the entire Rs. 20,501 crore came in existing equity funds.
The popularity of balanced funds continued to rise which is evident by the sustained inflows in the category. In August too, the category received inflows of Rs. 2,079 crore. Balanced funds now manage Rs. 53,881 crore, surpassing the ELSS category which manages Rs. 50,604 crore.
Compared to Rs. 1.02 lakh crore net inflows overall in mutual funds in July, which came mainly in income and liquid funds, inflows in August dried up at Rs. 25,332 crore. Nevertheless, the total assets under management of the industry went up with the total industry AUM inching up from Rs. 15.18 lakh crore in July to Rs. 15.63 lakh crore in August.
