The latest AMFI data shows that equity funds received net inflows of over Rs. 9,000 crore in August, when the Sensex dropped by nearly 2,000 points.
On August 24, when the Sensex dropped by more than 1,600 points, fund officials said that a lot of investors rushed to cash in on this opportunity. According to rough estimates, the industry received Rs. 1,000 crore in equity funds on that single day. Raghav Iyengar, EVP, & Head – Sales, ICICI Prudential Mutual Fund had earlier told Cafemutual. “After the market crisis, investors have realized that they should invest when markets dip. This was the case on Monday when we received good inflows. The participation from retail and HNIs was good. This is definitely a positive trend for the industry.”
A large chunk of money flowed in to existing equity funds. MFs received gross inflows of Rs. 14,843 crore in existing equity funds while NFOs mopped up Rs. 1,057 crore. There were three equity NFOs in August - ICICI Prudential India Recovery Fund Series 3, ICICI Prudential Value Fund Series 8 and Axis Equity Saver Fund.
Barring Gold ETFs, liquid funds and overseas fund of funds, all other categories received positive net inflows.
Liquid funds & money market funds saw net outflows of Rs. 70,489 crore in August. As a result, the industry’s AUM slipped from an all-time high of Rs. 13.17 lakh crore in July to Rs. 12.55 lakh crore in August. “A fear has gripped the market after the Amtek episode. Investors have become conscious of portfolio quality. The money has gone out of liquid category,” said the sales head of a foreign fund house.
“There could be two reasons why liquid funds saw such huge outflows. Firstly, investors could have taken out money to pay advance tax. Secondly, there is a fair amount of panic among large investors. Some funds are holding low grade paper in debt schemes. So investors are moving to safer assets,” said the CEO of a private sector fund house.
Net inflow/outflow in August
|
Category |
Net inflow/outflow in August |
|
Equity |
8,760 |
|
ELSS |
396 |
|
Balanced |
1,425 |
|
Liquid |
-70,489 |
|
Gilt |
143 |
|
Other ETFs |
469 |
|
FOFs overseas |
-43 |
|
Income |
12,671 |
|
Gold ETFs |
-82 |
|
Total |
-46,750 |
|
Source: AMFI. Rs cr |
|
