Where is mutual fund money going? Report reveals April’s biggest portfolio shifts

Domestic mutual funds actively repositioned portfolios in April 2026, increasing allocations to sectors such as banking, FMCG and healthcare while continuing to witness strong investor flows into flexi-cap schemes, according to Ambit Capital’s latest report, “Strategy: MF Activity Tracker – Dissecting MF Portfolio: Where’s the Flow?” The report provides a detailed assessment of portfolio changes, fund flows and long-term ownership trends across the mutual fund industry.

According to Ambit, BFSI, FMCG and Healthcare recorded the highest mutual fund buying activity in April, after adjusting for sector performance. Meanwhile, sectors such as Auto, Utilities and Consumer Durables saw net selling pressure during the month.

The report noted that on a calendar year-to-date basis, BFSI, Telecom and New-age Technology sectors have attracted the largest cumulative inflows, indicating continued investor preference toward financials and technology-linked themes.

Sector allocations also shifted noticeably. Mutual fund portfolios saw the sharpest rise in weights for Capital Goods (+78 basis points), Utilities (+19 basis points) and FMCG (+16 basis points). In contrast, IT (-60 basis points), Healthcare (-26 basis points) and Oil & Gas (-19 basis points) recorded the largest declines. Ambit said the changes reflected a mix of active fund positioning and market performance effects.

MUST READ: Why PPFAS Flexi Cap Fund is holding cash even after a 10% fall -- Rajeev Thakkar explains

MUST READ: Can Indian equities and mutual funds still create long-term wealth for investors?

Top stocks bought and sold

Among individual stocks, Eternal emerged as the top large-cap purchase with mutual funds buying 0.9% of total shares outstanding. In the mid-cap category, Poonawalla Fincorp led with purchases equivalent to 4.2% of shares outstanding, while Indraprastha Gas topped small-cap buying with 2.5% of outstanding shares acquired.

Other stocks witnessing significant buying activity included ICICI Bank, SBI, Adani Ports & SEZ and Max Healthcare Institute.

On the selling side, Wipro, Mahindra & Mahindra Financial Services and Apollo Pipes emerged as the largest sells across large-, mid- and small-cap categories.

By value, Wipro, Bajaj Auto, NTPC, Jio Financial Services and GE Vernova T&D India were among the top stocks sold by domestic mutual funds in April.

Flexi-cap funds

The report also highlighted strong investor preference for diversified equity products. Flexi-cap funds recorded the highest net inflows at ₹101 billion in April, followed by small-cap funds at ₹69 billion and mid-cap funds at ₹66 billion.

While investor appetite remained healthy, SIP trends showed moderation. SIP inflows declined to ₹311 billion, though net equity inflows rose marginally to ₹434 billion compared with ₹432 billion in March. Net SIP account creation remained slightly negative.

MUST READ: Why are more young Indians and women entering mutual funds, markets?

Industry structure continues to evolve

Mutual fund managers also reduced cash allocations during the month. Cash as a percentage of total AUM declined to 5.5%, while cash positions in flexi-cap, large-cap, mid-cap and small-cap funds stood at 8.5%, 4.4%, 4.5% and 6.9%, respectively.

Meanwhile, equity assets under management increased 11.9% to ₹33.9 trillion, while cash AUM rose to ₹1.98 trillion.

The report also highlighted a larger structural shift underway in the mutual fund industry. Since April 2020, the share of equity funds in total AUM has risen from 36% to 52%, while the share of debt funds has declined from 55% to 28%. Individual ownership has also climbed from 44% to 60% over the last decade, reflecting deeper retail participation and a continuing shift toward equity-led investing.