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Equity mutual funds recorded the third consecutive month of net inflows and touched a new high of ₹10,083 crore in May as against ₹3,437 crore logged in April. This reflects growing investors’ confidence in the recent stock market rally.

Except for equity-linked saving schemes which recorded an outflow of ₹290 crore, all other categories of equity funds registered a net inflow.  Multi-cap funds topped the table by attracting investment of ₹1,954 crore, as per data released by the Association of Mutual Funds in India.

All other equity funds including mid-cap funds and focussed funds have received investments of ₹1,368 crore and ₹1,169 crore. Thematic funds and small-cap funds attracted ₹1,137 crore and ₹1,081 crore inflows.

Redemption in equity schemes in May dipped, compared to April. NS Venkatesh, Chief Executive, AMFI said that the retail equity-oriented contribution continues to be on the upward trend, while smart investors have diversified to Fund of Fund (FOF) schemes which invest in foreign equities.

Investment through systematic investment plan was up at ₹8,818 crore as against ₹8,596 crore logged in April.

Debt funds recorded a net outflow of ₹44,512 crore. This was mainly because of withdrawal of ₹45,447 crore and ₹11,573 crore from liquid and overnight funds.

Overall mutual funds industry AUM was up at ₹33.05-lakh crore last month as against ₹32.37-lakh crore logged in April.

Aashish P Somaiyaa, CEO, White Oak Capital said: “₹12,000 crore net inflow in equity and equity oriented hybrid funds is a significant jump and a sign of investor confidence – amongst the highest net inflows in a long time especially if one further adds flows into index funds, ETFs and international equity funds.”

Industry officials were excited about investor flows remaining strong. Akhil Chaturvedi, Head of Sales & Distribution, Motilal Oswal AMC, said: “This is the third month of net positive flows….DIIs and retail investors have kept the markets buoyant in the last three months when FIIs have been net sellers. Broadly, we understand from the first wave of Covid that these waves will be short-lived and eventually economic activities will revive giving a boost to market sentiments.”