Equity mutual fund inflows fell 9% month on month in September to Rs 30,421 crore, marking the second consecutive month of decline, according to data released by the Association of Mutual Funds in India (AMFI) on Friday.

Key Highlights

• Equity mutual fund inflows dropped to ₹30,422 cr in September, down 9% from August. 
• This marks a second straight month of declines, reflecting cautious investor sentiment.

Most of the 11 subcategories saw inflows, with the exception of dividend yield and ELSS funds. Midcap funds drew the most investor interest, with a total inflow of Rs 5,085 crore in September, followed by smallcap funds with an inflow of Rs 4,362.

Sectoral and thematic funds received the lowest positive inflow, totaling Rs 1,220 crore. ELSS and dividend yield funds saw outflows of Rs 307 crore and Rs 167 crore, respectively.

On a monthly basis, multicap funds, large and midcap funds, value/contra funds, and focused funds saw increases in inflows. Multicap funds saw an 11% increase in monthly inflows, while large and midcap funds saw a 14% rise.

Value/contra funds and focused funds experienced monthly inflow growth of 85% and 22%, respectively. In contrast, sectoral and thematic funds saw a 69% decrease in monthly inflows.

Debt mutual funds saw a total outflow of Rs 1.01 lakh crore in September, compared to Rs 7,979 crore in August.

Out of the 16 subcategories, only overnight funds, medium-to-long duration funds, long-duration funds, and dynamic bond funds received inflows. Overnight funds received the most inflows, totaling Rs 4,279 crore, followed by dynamic bond funds with Rs 519 crore. In September, liquid funds experienced the largest outflow, totaling Rs 66,042 crore.

In September, inflows into hybrid mutual funds fell 39% to Rs 9,397 crore, compared to Rs 15,293 crore in August. Among the six subcategories, conservative hybrid funds and arbitrage funds saw outflows this month.

Multi Asset Allocation funds received the most inflows at Rs 4,982 crore, followed by aggressive hybrid funds at Rs 2,013 crore. On a monthly basis, inflows into Multi Asset Allocation funds increased by 41% from Rs 3,527 crore in August.

Meanwhile, other schemes, such as index funds and ETFs, saw monthly inflows jump 67% to Rs 19,056 crore in September, up from Rs 11,436 crore in August. Gold ETFs received the most inflows, totaling Rs 8,363 crore, followed by other ETFs at Rs 8,150 crore.

Also Read: Equity Funds Hold 55% of MF Assets; Nagaland Leads Monthly Growth

Index funds and fund of funds (FoFs) that invest overseas received inflows of Rs 1,580 crore and Rs 961 crore, respectively. On a monthly basis, gold ETFs saw the greatest increase, rising 282% from Rs 2,189 crore in August. FoFs investing overseas, other ETFs, and index funds all saw growth of 92%, 13%, and 5%, respectively (MoM).

Open-ended funds lost Rs 42,815 crore in September, compared to an inflow of Rs 52,501 crore in August.

The total mutual fund AUM increased marginally by 0.57% month on month to Rs 75.35 lakh crore in September, up from Rs 74.93 lakh crore in August.

During the month, nine open-ended mutual fund schemes were launched, totalling Rs 1,959 crore. Index funds contributed Rs. 886 crore.

Kartik Jain, MD & CEO, Shriram AMC stated, “The AMFI September data highlights a steady yet insightful shift in investor preferences. The mutual fund industry added 40 lakh folios in the month, with total AUM inching up from ₹75.18 lakh crore to ₹75.38 lakh crore, reflecting continued investor engagement. Systematic Investment Plan inflows remain robust, signalling confidence in disciplined, long-term wealth creation."

"A standout trend is the growing appetite for precious metals. Gold ETFs recorded a remarkable incremental addition of about ₹8,500 crore, taking total AUM past the ₹90,000 crore mark. Silver ETFs, too, attracted significant attention from new investors, highlighting a diversification shift towards metals. This momentum is mirrored in multi-asset allocation funds, which saw nearly ₹5,000 crore inflows, largely driven by gold and silver allocations" he noted.

He added, "Global macro factors underpin this trend. Anticipated interest rate cuts, stubborn inflation, slowing global growth, and persistent geopolitical tensions are driving investors towards safe-haven assets. Fresh investments by central banks in gold and silver, coupled with record flows in bullion ETFs, further reinforce this demand. The September data underscores the increasing role of precious metals in long-term wealth diversification. For investors, it’s a reminder that balancing traditional equity and debt hybrid strategies along with strategic asset allocation to metals can strengthen portfolios against economic uncertainties, while tapping into avenues for long term growth.