Equity funds witness Rs 7,600 cr net inflows in June, SIPs strong; liquid funds hit by quarterly redemptions

SIPs have now set a new normal with monthly flows consistently crossing over Rs 8,000 crore

Kumar Shankar Roy Jul 8, 2019

Like at the end of every quarter, liquid funds were hit by redemptions in June 2019. Corporate treasuries and other liquid MF investors pulled out a whopping Rs 1.52 lakh crore from the FD-alternative category. Other debt fund categories too witnessed churn, with fixed income funds as a group showing Rs 1.71 lakh crore worth funds going out. The news from equity funds is better. Stock market funds saw Rs 7,663 crore net inflows in June, an improvement compared to the Rs 5408 crore in May, data from industry body AMFI shows. Let us have a detailed look at what transpired in mutual fund mart.

Equity

Net Inflows for the open-ended equity-oriented schemes have been consistently rising for the last three months since April 2019.

The June 2019 figure of Rs 7,663.14 crore was largely driven by Multi Cap and Large Cap funds. Small Cap, Sectoral/Thematic Funds and ELSS also attracted investor money. Equity funds today manage Rs 7.23 lakh crore worth investor assets.

In terms of folios, dividend yield funds and value/contra funds saw folio count going down in June over May.

The trend in SIP contribution for June 2019 continues to be robust at Rs 8,122.13 crore coming from 2.73 crore SIP accounts.

Take a look at the various equity category flows, and redemptions in June

equity funds inflow june 2019

Debt

Net outflows from income and debt oriented schemes to the tune of Rs 1,71,349.32 crore during June 2019 has led to an overall decline in the June month-end AUM (Assets Under Management) at Rs 24,25,040.37 crore from Rs 25,93,559.63 crore as on May 31, 2019.

Liquid funds witnessed Rs 1.52 lakh crore outflows in June. Credit risk funds witnessed nearly Rs 2,700 crore net outflows. Ovenight funds and low duration funds experienced over Rs 4,000 crore net outflows each this month.

Commenting on the occasion, N S Venkatesh, Chief Executive, AMFI said: “Stellar jump in the inflows into equity schemes over the last two months, especially after the decisive electoral verdict has helped repose retail investor trust. Political stability, lower inflation coupled with RBI stance to lower interest rates leading to possible robust growth in the corporate earnings is leading enhanced retail flows towards equity oriented schemes. On the fixed income side, although there has been outflows from liquid schemes, the flows into Gilt schemes and Long duration schemes have stood positive, owing to RBI’s dovish stance on interest rates.”

On the liquid fund outflows, Venkatesh said, “This is a usual quarter-end phenomenon where the industry does witness temporary redemptions from liquid funds.”

Take a look at the various debt category flows, and redemptions in June

Debt funds June 2019 AMFI

Arbitrage schemes continue to witness positive net inflows, albeit lower as compared to May 2019, which has stood in favour of overall net inflows for hybrid schemes at Rs 862.61 crore.


Kumar Shankar Roy

Kumar Shankar Roy is contributing editor with RupeeIQ. Kumar is a financial journalist, with a functional experience of 15 years. He tracks mutual funds, insurance, pension, PMS, fixed income/debt and alternative investments markets closely. He has worked for The Times of India, The Hindu Business Line, Deccan Chronicle Group, DNA, and Value Research, among others, across different cities in India. He is deeply interested in marrying data insights with actionable opinion. He can be contacted at kumarsroy@rupeeiq.com.

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