Title: Retail Investors Bullish on Equities as Small Cap Funds See Robust Inflows
The month of October saw a continued preference for small cap funds as investors funneled money into the category, with inflows reaching Rs 4,495.13 crore. According to the Association of Mutual Funds of India (AMFI), the mutual fund industry had four crore unique investors in September, marking the highest figure recorded to date. SIP accounts also stood at 7.13 crore.
Retail investors have played a significant role in bolstering the markets, with a total of Rs 108,517 crore being invested into equity-oriented schemes in the first nine months of the year. In October, retail investors pumped in Rs 19,932 crore into equity-oriented schemes, representing a 44% increase in flows from the previous month.
Sectoral funds received the second largest inflows during the month at Rs 3,895.72 crore. Despite the general increase in equity fund inflows, capital inflows into long term debt funds remained negligible. Furthermore, equity mutual fund inflows stood at Rs 14,091.26 crore in September, a decrease from the August inflows of Rs 20,245.26 crore.
The data also revealed that capital inflows into equity oriented schemes in 2023 have demonstrated a positive trend, fueled largely retail investors who injected a total of Rs 108,517 crore into equity oriented schemes in the first nine months of the year. This signals a resilient market driven confidence in the future prospects of the Indian economy.
In August, net inflows into equity oriented mutual funds more than doubled to Rs 20,245.26 crore, compared to Rs 7,625.95 crore in July. The total number of systematic investment plans (SIPs) accounts stood at 6.96 crore. The demand for small-cap and sectoral funds drove higher inflows, while debt funds continued to see outflows, primarily driven liquid funds. AMFI’s CEO, NS Venkatesh, expressed optimism about the future, stating that economic growth and corporate earnings improvements will continue to drive equity fund inflows.
Thematic and sectoral funds received the highest inflows at Rs 4,805.81 crore, followed small cap funds at Rs 4,264.82 crore. Large cap funds, however, experienced outflows. Money market funds saw the lowest inflows, potentially due to reduced interest in debt funds after the withdrawal of indexation benefits.
Overall, the data indicates sustained confidence and robust inflows from retail investors, displaying strong support for the Indian equity market.