Inflows into equity mutual fund schemes rose by 14 per cent in December to ₹41,156 crore compared to ₹35,943 crore logged in November largely due to the new fund offers (NFOs).

The industry raised ₹11,402 crore through 13 equity NFOs while the overall NFO inflow was at ₹13,852 crore.

Interestingly, thematic funds registered the highest inflow of ₹15,332 crore, with 12 thematic NFOs contributing ₹11,337 crore last month.

Steady inflows

Mid and flexi-cap funds recorded inflows of ₹5,093 crore (₹4,883 crore) and ₹4,731 crore (₹5,084 crore). Despite the steady inflows, the overall equity assets under management remained flat at ₹30.57 lakh crore (₹30.35 lakh crore) due to mark-to-market loss.

In 2024, equity mutual funds received a net inflow of ₹3.94 lakh crore, which was sharply higher than the net inflow of ₹1.62 lakh crore in 2023.

The benchmark Sensex and Nifty were down two per cent each last month, settling at 78,139 points and 23,644 points, compared to 79,802 points and 24,131 points in November.

Inflows through Systematic Investment Plan jumped to ₹ 26,459 crore (₹25,320 crore).

Himanshu Srivastava, Associate Director-Manager Research, Morningstar Investment Research India, said that thematic funds are typically cyclical in nature and entry and exit from these funds needs to be timed as they are very volatile.

“Given some of the sector funds have delivered good returns in recent times has attracted investors and they should observe caution while investing in these funds,” he added.

Venkat Chalasani, Chief Executive, AMFI said Despite volatile market conditions, equity-oriented schemes continued to see strong inflows, reflecting investors’ confidence and commitment to stay invested for the long term.

The outflow of ₹1.27 lakh crore from debt schemes was the usual quarter-end phenomenon and will get normalised soon, he added.

Suranjana Borthakur, Head of Distribution & Strategic Alliances, Mirae Asset Investment Managers (India) said a balanced allocation of large, mid and small cap is essential for wealth generation and investors should focus on forward-looking returns rather than historical performance.

“Hybrid products should gain prominence as asset allocation becomes increasingly important. The debt side of hybrid funds, coupled with commodities such as gold, could generate solid returns amid global volatility,” he added.

Jatinder Pal Singh, CEO of ITI Mutual Fund said despite muted equity market performance during December 2024, inflows in open-ended equity funds stayed in the positive zone for the 46th month in a row.

Inflows in the large-cap category were down by 8 per cent m-on-m while net flows were down 21 per cent compared to last November, he said.