Equity fund inflows dips in May, registers lowest flow since November: AMFI data

The latest data of the Association of Mutual Funds in India shows that equity mutual fund inflow dipped in May 2023 after witnessing a net inflow of Rs 2,906 crore as compared to Rs 5,275 crore in April 2023, primarily due to profit booking by investors amid rising market. This is the lowest since November 2022 when the equity fund inflow was Rs 2,224 crore.

However, this was also the 27th consecutive month of inflow in the equity class, which was primarily driven by fund infusion in small-cap and mid-cap categories.

“Profit booking in rising market along with probable expenses towards vacation, education could have led to lower investments in mutual funds in May,” Manish Mehta, National Head and Sales, Marketing and Digital Business at Kotak Mahindra Asset Management Company, said.

In contrast, the inflows in Systematic Investment Plan (SIP) achieved a new high of Rs 14,749 crore in May as compared to Rs 13,728 crore in April. 

The total asset under management (AUM) of the mutual fund industry as of May 2023 rose to Rs 43.20 lakh crore from Rs 41.61 lakh crore in April and Rs 39.42 lakh crore in March 2023.

In May, the small-cap inflow performed well and registered a fund inflow of Rs 3,283 crore as against Rs 2,182 in April. The midcap fund and dividend yield fund witnessed inflows at Rs 1,196 crore and Rs 289 crore, respectively.

Overall, the 42-player mutual fund industry continues to see inflow and attracted Rs 57,420 crore, on contributions from debt-oriented schemes. This comes following a net investment of Rs 1.21 lakh crore in the preceding month.

Mutual Fund Figures for May 2023

Inflow/Outflow	May (in Rs lakh crore)	April (in Rs lakh crore)
Smallcap Funds	3,283	2,182
Midcap Funds	1,196	1,791
Largecap	-1,362	53 (inflow)
ELSS	-505	61 (inflow)

On the debt side, the inflow was registered at Rs 45,959 crore in May as against Rs 1.06 lakh crore.
In terms of high outflow, the equity-linked saving scheme or ELSS saw a significant outflow of Rs 505 crore in the month of May.
The corporate bond fund inflow saw an inflow of Rs 622 crore, while large-cap funds saw an outflow of Rs 1,362 crore as against large-cap fund inflows of Rs 53 crore in April 2023.

The valuation difference in comparison to large-cap stocks continues to play out well for investors opting for mid and small-cap funds since the beginning of the calendar year, Gopal Kavalireddi, Vice President- Research at FYERS, said.

(With agency inputs)

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