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Equity mutual funds received an encouraging response from investors in January 2023 and reported positive flows across categories. Overall, they received net inflows of Rs. 12,500 crore, significantly higher than Rs. 7,300 crore reported in December 2022.
A category-wise review shows that small cap funds, large & mid cap funds and multi cap funds received the highest inflows of Rs. 2,250 crore, Rs. 1,900 crore and Rs. 1,770 crore, respectively. Notably, the inflows in multi cap funds came largely from HSBC Multi Cap NFO which mobilised Rs. 1,200 crore.
Here are the other key highlights of the month gone by.
Fund flows across other categories
Debt funds - In the current scenario of rising interest rates, debt funds witnessed net outflows of Rs. 10,300 crore. Liquid funds (Rs. 5,000 crore), short duration funds (Rs. 3,860 crore) and overnight funds (Rs. 3,690 crore) reported the highest outflows.
However, net inflows of Rs. 6,460 crore in money market funds and Rs. 1,760 crore in ultra short duration funds reduced the impact of outflows to some extent.
Hybrid funds - Apart from equity savings funds and dynamic asset allocation/balanced advantage fund, hybrid funds saw net inflows across other categories. Multi asset allocation funds (Rs. 2,180 crore) and arbitrage funds (Rs. 2,050 crore) reported the highest inflows. Inflows in multi asset allocation funds were largely due to Aditya Birla Sun Life Multi Asset Allocation NFO which mobilised Rs. 1,570 crore.
Overall, hybrid funds saw net inflows of Rs. 4,490 crore.
Passive funds - Overall, passive funds received net inflows of Rs. 3,950 crore. While index funds saw net inflows of Rs. 5,810 crore, ETFs (gold and others) reported net outflows of Rs. 1,910 crore.
There were a total of 8 NFOs in the last month - 6 index funds and 2 other ETFs, which collectively mobilised Rs. 420 crore and Rs. 27 crore respectively.
Other data points
Industry AUM - The average AUM stood at Rs. 40.80 lakh crore including Rs. 20.65 lakh crore in retail assets across equity, hybrid and solution-oriented schemes
Folio count - The folio count reached 14.28 crore including 11.43 crore retail folios in equity, hybrid and solution-oriented schemes
SIP - Investors registered nearly 23 lakh SIPs. The number of SIP accounts and SIP AUM stood at 6.23 crore and Rs. 6.74 lakh crore, respectively
How does the industry look at these numbers?
N S Venkatesh, Chief Executive, AMFI - “There has been an overall growth momentum observed in mutual fund folios. January 2023 data showcases a positive trend in the equity mutual fund inflows. Small Caps have witnessed inflows, majorly driven by the retail investors as their investment is for long-term return cycle. Encouraging SIP numbers indicate retail investors’ trust in mutual funds. We believe that SIP inflow momentum has and will continue to balance the FII outflows in the market.”
Akhil Chaturvedi, Chief Business Officer, Motilal Oswal MF - “Strong flows for the month supported by SIP inflows, despite a volatile month with markets being subdued, the net positive flows is a sign of increasing maturity of investors to continue their allocations in equity mutual funds.”
