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Informist, Tuesday, Jun. 10, 2025

 

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--MF industry May net inflows at INR 291.08 bln 
--MF industry AUM at INR 72.20 tln as on May 31 
--MF industry AUM at INR 72.20 tln as on May 31, up 3.14% on month 
--Open-ended debt funds May net outflows at INR 159.08 bln 
--Open-ended debt funds AUM at INR 17.54 tln as on May 31 
--Open-ended equity funds May net inflows at INR 190.13 bln 
--Open-ended equity funds AUM at INR 32.05 tln as on May 31 
--Open-ended equity funds AUM at INR 32.05 tln as on May 31, up 4.8% MoM 
--Liquid funds May net outflows at INR 402.05 bln 
--Corporate bond funds May net inflows at INR 119.83 bln 
--Money market funds May net inflows at INR 112.23 bln 
--Small Cap funds May net inflows at INR 32.14 bln 
--Multi Cap funds May net inflows at INR 29.99 bln 
--Mid Cap funds May net inflows at INR 28.09 bln 
--Flexi Cap funds May net inflows at INR 38.41 bln 
--Arbitrage funds May net inflows at INR 157.02 bln 
--Gold ETFs May net inflows at INR 2.92 bln 
--Other ETFs May net inflows at INR 40.87 bln 
--4.3 mln SIP folios matured, discontinued in May 
--MFs added 5.9 mln new folios under SIP in May 
--High inflow in corporate bond fund maybe on view of dovish RBI policy 
--Expect volatility in short term, long-term view intact 
--Lower term deposit rates made corporate bond funds attractive in May 
--Short-term debt funds to see more inflows as interest rates may fall 
--Institutions may prefer liquid, overnight funds going forward 
--High net worth investors expected to invest more in arbitrage funds 
 

 

MUMBAI – Net inflows into the mutual fund industry fell to INR 291.08 billion in May from INR 2.77 trillion in April as liquid funds saw outflows of INR 402.05 billion during the month, compared to inflows of INR 1.19 trillion in April, according to data from the Association of Mutual Funds in India. 

 

Overall, debt funds saw a dismal month in May, with open-ended schemes seeing outflows of INR 159.08 billion, in contrast to the INR 2.19 trillion of inflows seen in April. Corporate bond funds, which are usually a drop in the bucket of debt schemes, saw a surge in inflows to INR 119.83 billion from INR 34.58 billion in April.

 

As an industry, mutual fund assets under management were up 3.14% on month at INR 72.20 trillion as on May 31. AUM of open ended debt funds was largely unchanged from the previous month at INR 17.54 trillion. 

 

Venkat Chalasani, chief executive of the Association of Mutual Funds in India, said the outflow from liquid funds and overnight funds was due to high volatility in the market. However, Chalasani expects funds from institutional investors to return to liquid funds. "The institution money can come into back into the liquid funds and to the overnight funds because the yields on the liquid and overnight funds would be slightly better when compared to the normal rates. So, therefore, we might see positive cues," he said in a conference call with the media. 

 

Within debt funds, money market funds saw inflows of INR 112.23 billion in May, lower than INR 315.07 billion in April. Chalasani said the fall in inflows in money market funds and the sharp growth in inflows in corporate bond funds could both be attributed to the Reserve Bank of India adopting a softer policy. "There is a positive growth in money market funds and very positive growth in corporate bond funds. It could be on account of the expectations of a dovish outlook (from the RBI)," he said. Chalasani said a cut in term deposit rates of banks also made corporate bonds more attractive to investors in May.  

 

Flows into small-cap and mid-cap funds were steady at INR 32.14 billion and INR 28.09 billion, respectively. Multi-cap funds saw inflows of INR 29.99 billion in May, while flows into flexi-cap funds were at INR 38.41 billion. 

 

For equity funds, flows into open-ended schemes were at INR 190.13 billion in May, slightly lower than INR 242.69 billion in April. Chalasani said the flows into these funds were mainly on account of marked-to-market gains.

 

Chalasani said that going forward, high net worth individuals were expected to invest more in arbitrage funds. These funds saw inflows of INR 157.02 billion in May, slightly higher than INR 117.90 billion in April. Overall, hybrid funds saw inflows of INR 207.65 billion with the total assets under management at INR 9.55 trillion as of May 31. 

 

Inflows through systematic investment plans rose to INR 266.88 billion in May from INR 266.32 billion in April. While 5.9 million new portfolios were added in this category in the month, 4.3 million folios were discontinued. The total number of systematic investment plan portfolios were at 85.6 million at the end of May, Chalasani said.

 

The 20 gold ETFs saw net inflows of INR 2.92 billion in May, against net outflows of INR 582 million in April. The net assests under management in gold ETFs rose nearly 2% on month to INR 624.53 billion in May. The last time, negative flows were probably in account of profit booking, Chalasani said. "Now, we are witnessing the positive close, which reversing the previous trend, people are looking at on account of volatility and expecting (gold) prices can slightly go up," he said. Other ETFs saw inflow of INR 40.86 billion in May.  End

 

Reported by Kabir Sharma and J. Navya Sruthi

Edited by Avishek Dutta

 

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