Millennium Post

Equity MF inflows jump 3-fold to ₹ 28,000 crore in April-June

Equity mutual funds have seen an inflow of over 28,000 crore in April-June 2017, a surge of nearly three-times from the year-ago level, underpinned by investors' optimism.

"Inflows in equity mutual fund schemes have been robust of late as investors chase higher returns in the wake of lower yields from fixed income instruments and poor performance by realty and commodities (gold)," Bajaj Capital CEO Rahul Parikh said.

"Besides, the higher inflows can be attributed to the shift of flows from income funds and money market funds to equity, equity linked saving schemes (ELSS) and equity oriented balanced funds, due to low yields on such segments at present. A year back, they were higher, a gap of almost 75-125 basis points," he added.

Parikh further said the spurt in inflows in equity schemes can also be linked to rise in new issuances or New Fund Offers (NFOs) during the quarter under review as compared to the year-ago level and optimistic investors' sentiments. Money raised from NFOs focused on equity schemes was at Rs 4,908 crore in April-June 2017, much higher than Rs 173 crore garnered in the same period last year.

According to data from the Association of Mutual Funds in India (Amfi), equity funds, which also include ELSS, saw net inflows of Rs 28,332 crore in the three months ended June 30, 2017, higher than Rs 9,479 crore in the year-ago period.

The assets under management (AUM) of equity MFs scaled a record high of Rs 5.91 lakh crore at the end of June 2017 from Rs 4.28 lakh crore at June-end 2016.

MFs are investment vehicles made up of a pool of funds collected from a number of investors. The funds are invested in stocks, bonds and money market instruments, among others.

The size of an equity fund is determined by a market capitalization, while the investment style, reflected in the fund's stock holdings, is also used to categorize equity mutual funds.

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