Sectoral/Thematic Funds Lead Inflows; Fixed Income Sees Major Outflows – December AMFI Data

The Indian mutual fund landscape witnessed notable shifts in December 2024, as open-ended equity mutual fund inflows soared despite muted market performance. According to data released by the Association of Mutual Funds of India (AMFI) on January 9, inflows were driven by strong interest in thematic/sectoral and small-cap funds. However, the overall industry saw significant net outflows due to sell-offs in the debt segment.

Equity Mutual Fund Inflows: A Positive Streak

Open-ended equity mutual funds continued their positive streak for the 46th consecutive month, recording inflows of ₹41,155.91 crore in December compared to ₹35,943.49 crore in November.

Thematic/Sectoral and Small-Cap Mutual Funds Shine

• Thematic/Sectoral Mutual Funds: Inflows doubled month-on-month, reaching ₹15,331.54 crore in December, up from ₹7,657.75 crore in November. This surge was largely attributed to new fund offers (NFOs), with 12 NFOs collectively raising ₹11,337 crore during the month.
• Small-Cap Mutual Funds: The category attracted ₹4,667.70 crore in December, surpassing November’s ₹4,111.89 crore. 

Decline in Large & Mid-Cap Categories

The large and midcap fund category witnessed a drop in inflows, recording ₹3,811.81 crore in December compared to ₹4,679.74 crore in November. 

SIP Contributions Reach New Heights

Systematic Investment Plans (SIPs) remained a cornerstone of retail investment, with contributions surpassing ₹26,000 crore for the first time in December. The total SIP inflow stood at ₹26,459 crore, marking a significant rise from ₹25,320 crore in November.

Debt Funds: A Contrasting Trend

While equity inflows were robust, the fixed-income segment saw considerable net outflows, amounting to ₹1,27,152.63 crore in December.

Notable Outflows in Debt Categories:

• Liquid Funds: Net outflows of ₹66,532.12 crore.
• Money Market Funds: ₹25,842.96 crore in outflows.
• Overnight Funds: ₹22,347.58 crore in outflows.

Small inflows were observed in niche categories such as Long Duration Funds and Gilt Funds, but they were insufficient to offset the broader trend.

Overall Mutual Fund Performance

Despite strong inflows in equity funds, the mutual fund industry recorded net outflows of ₹80,509.20 crore in December, compared to ₹60,363.70 crore in November. The industry’s total net assets under management (AUM) stood at ₹66.93 lakh crore, a decline from ₹68.08 lakh crore in the previous month.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.