Mumbai (Maharashtra) [India], June 10 (ANI): Net equity mutual fund inflows fell sharply by 21.66 per cent month-on-month to Rs 19,013 crore in May 2025, the lowest in a year, despite a rising stock market.
However, the mutual fund industry’s overall AUM hit an all-time high of Rs72.2 lakh crore, backed by positive momentum in select debt categories.
According to the data released by the Association of Mutual Funds in India (AMFI) on June 10, Tuesday, net inflows into equity mutual funds plunged to Rs 18,995 crore in May 2025, down from Rs24,253 crore in April 2025.
This marks the lowest equity inflow in 12 months, even as the Sensex rose over 1.5 per cent and Nifty 50 gained over 1.7 per cent during the month, suggesting that investors are cautious amid elevated valuations and geo-political uncertainties.
Akhil Chaturvedi, Executive Director & Chief Business Officer, Motilal Oswal AMC said “Equity Net Sales has seen a sharp downtick of 22 per cent largely on account of higher redemptions by 5k cr in May’25 (viz April’25). This was probably due to the war-like situation in the beginning of the month leading to sentiment being cautious.”
Largecap funds bore the maximum brunt, with net inflows plummeting 53.19 per cent to Rs 1,250 crore in May, from Rs 2,671 crore in April, while midcap and small-cap funds also saw a pullback, declining 15.25 per cent and 19.64 per cent, respectively.
Mid-cap fund inflows dropped to Rs 2808.7 crore in May from Rs 3,313 crore in April while small-cap funds inflows dropped Rs 3,214 crore in May from Rs 3,999.95 crore in April.
This moderation suggests a potential pause in retail participation amid concerns over stretched mid- and small-cap valuations.
However, systematic investment plan (SIP) contribution in May remained robust at Rs 26,688 crore as compared with Rs 26,632 crore in April. This shows retail investors faith in systematic investment remains constant.
“SIP numbers over 26000 cr is very encouraging, which implies that the fresh investment preferred route has been SIP than lumpsum” Chaturvedi added.
On the debt side, debt mutual funds witnessed net outflows of Rs 15,908 crore, a steep reversal from the Rs 2.19 lakh crore net inflow in April. Most of the outflows came from liquid funds (Rs 40,205 crore) and overnight funds (Rs 8,120 crore).
Narender Singh, smallcase Manager and Founder of Growth Investing said “Compared to last year, when debt funds enjoyed net inflows, this reversal suggests growing caution, likely due to interest rate expectations”.
However, corporate bond funds and money market funds attracted net inflows of Rs11,983 crore and Rs11,223 crore, respectively.
Despite the drop in equity and debt inflows, the overall AUM of the mutual fund industry rose to a record Rs72.20 lakh crore, compared to Rs69.99 lakh crore in April. This growth is supported by market appreciation and continued SIP contributions. (ANI)
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