Equity mutual fund inflows rise 26% in June; gold ETFs rebound
Inflows into equity mutual funds rose 26% in June compared to the previous month, driven by a record high in systematic investment plan (SIP) contributions. The Association of Mutual Funds in India (AMFI) reported that SIP contributions reached Rs 31,781 crore, the highest in three months, reflecting growing investor confidence in disciplined, long-term investing.
Net outflows from the overall mutual fund industry narrowed to Rs 52,949 crore in June, down from Rs 64,021 crore in May, as more money flowed into equity schemes. Meanwhile, gold exchange-traded funds (ETFs) saw a 65% month-on-month increase in inflows, signaling a rebound after outflows in the previous month.
Flows into hybrid mutual funds also increased, indicating that investors are diversifying across schemes amid stock market volatility driven by geopolitical uncertainties. June marked the 64th consecutive month of positive equity inflows, according to AMFI CEO Venkat Chalasani.
The mutual fund industry's assets under management (AUM) rose to a new record of Rs 82.2 lakh crore as of June 30, up from Rs 81.6 lakh crore at the end of May. Additionally, the industry's assets under control (AUC) reached Rs 76.41 lakh crore, surpassing foreign investors' AUC of Rs 76.22 lakh crore for the first time, highlighting the industry's growth amid heavy foreign outflows this year.
Equity inflows increased 26% month-on-month and 23% year-on-year to Rs 28,973 crore in June. Mid-cap funds, the most popular category, saw inflows rise nearly 39%, while multi-cap, large and mid-cap, focused, and value funds also recorded increases of over 30%.
On the debt side, outflows widened to Rs 1.09 lakh crore from Rs 96,949 crore in May. The outflows were primarily from liquid, low-duration, and short-duration funds, which are often used by companies and institutional investors for short-term cash parking.
Gold ETFs saw net inflows of Rs 3,443 crore in June, reversing an outflow of Rs 725 crore in May. Silver ETFs also attracted inflows of Rs 4,287 crore, compared to an outflow of Rs 2,113 crore in the previous month. The rebound in precious metal ETF flows suggests that investors continue to view gold as a portfolio diversifier amid global uncertainty. The fall in gold prices from its peak in late January may have provided an attractive entry point for investors.
