In November, contributions to systematic investment plans (SIPs) surpassed Rs 17,000 crore for the first time. While monthly contributions reached a new high of Rs 17,073 crore, SIP AUM (assets under management) also reached a new high of Rs 9.3 trillion, up from Rs 8.6 trillion in October, according to data from the Association of Mutual Funds in India (Amfi) on Friday.
Net inflows into open-ended equity schemes declined to Rs 15,536 crore in November, from Rs 19,957 crore the previous month. Inflows into large cap funds remained healthy, but fell to Rs 307 crore.
"Flows in this category have been generally disappointing over the year, as investors may have preferred to invest in this segment passively through index funds and ETFs due to their low cost," said Melvyn Santarita, analyst at Morningstar Investment Research India.
Small size funds remained the top choice for investors, attracting Rs 3,700 crore, while midcap funds attracted Rs 2,666 crore. As of November 30, retail AUM (equity, hybrid, and solution-oriented schemes) amounted at Rs 27 trillion, with an average AUM of Rs 26.4 trillion for the month.
However, open-ended debt plans lost Rs 4,706 crore. Money market funds received Rs 865 crore in net inflows, while long term funds received only Rs 87 crore. The majority of the debt schemes had net outflows. In October, the debt category received Rs 42,634 crore in net inflows, with liquid funds benefiting the most.
"Investments in fixed income funds have been noticeably subdued since the revision of tax laws." The uncertainty around interest rates has complicated investors' investment decisions even more. Furthermore, the strong performance of equities markets has piqued the interest of investors," said Himanshu Srivastava, associate director of manager research at Morningstar India. The Banking & PSU Fund and floater fund schemes each received Rs 305 crore and Rs 648 crore. Inflows into gilt funds were Rs 92 crore.
According to Srivastava, the uncertainty around the timing of interest rate cuts has pushed some investors to select money market and floater funds as part of their debt allocation in their portfolios. As of November 30, the industry's net AUM was more over Rs 49 trillion, with an average AUM of Rs 48.74 trillion for the month. As of the end of October, the net AUM was Rs 46.7 trillion, while the average AUM was Rs 478 trillion.
