Equity MF inflows surge 71% to Rs 12,472 crore

It is yet another month of positive inflows into equity MFs since March 2021. 13,573 crore in December 2022 13,856 crore in January. Compared to January 2022, SIP contribution increased by 20.3%.

The number of SIP accounts grew by nearly 23% to 62.2 million in January compared to a year ago. Commenting on the latest data, Amfi CEO NS Venkatesh said, “The encouraging SIP numbers indicate retail investors’ confidence in mutual funds. We believe the pace of SIP inflows will continue to balance FII outflows in the market.”

Kavita Krishnan, Senior Analyst-Manager Research, Morningstar India, said FII selling was largely driven by factors such as valuation jitters, FII movements in other emerging economies and profit booking.

In equities, there was a net inflow of small-cap, large- and mid-cap and multi-cap funds 2,256 crores, 1,902 crore and 1,773 crore respectively. Investors have been getting attracted towards small-cap funds after the correction in their valuations since several months.

“With most investors taking conscious investment decisions, their overall preference towards investing in dips is evident from the magnitude of inflows into small and mid-cap stocks, Nifty Smallcap 100 was one of the worst performers in December 2022 . On an overall basis, Krishnan said, markets ended January in the red, with most sectors seeing negative returns except for the information technology and auto sectors.

Debt MFs, (both open-ended and closed-end schemes) saw net outflows 9,733 crore in January, but was sharply down from the net outflow of 20,732 crore in December, led by an outflow of 5,042 crore from liquid funds, 3,859 crore from short duration funds and 3,688 crore from overnight fund. Contrary to the outflow trend of debt MFs, money market funds saw net inflows 6,460 crore, while ultra-short duration funds saw inflows 1,765 crores.