Business

IIE DIGITAL DESK :Equity mutual fund inflows in India dropped by 14.4% in March 2025, according to the latest data released by the Association of Mutual Funds in India (AMFI). Investors poured ₹26,866 crore into equity mutual funds during the month, compared to ₹31,696 crore in February, marking a significant month-on-month decline in fresh investments. The dip in inflows comes amid heightened market volatility and profit booking by investors after a sustained market rally earlier in the year.

The decline is largely attributed to a sharp drop in investments in sectoral and thematic funds, which had seen massive interest in previous months. Sectoral funds, which had witnessed inflows of over ₹11,000 crore in February, saw that number shrink dramatically to under ₹1,000 crore in March. Despite the overall decline, small-cap and mid-cap equity funds continued to attract investor interest, clocking inflows of ₹4,868 crore and ₹2,605 crore respectively.

Meanwhile, contributions through systematic investment plans (SIPs) remained robust but saw a slight dip. Monthly SIP inflows stood at ₹19,271 crore, compared to ₹19,187 crore in February, while the total number of SIP accounts fell slightly to 8.11 crore. The consistent SIP flow indicates continued long-term investor confidence despite short-term market jitters.

This is the 49th consecutive month of positive net inflows into equity mutual funds, a streak that began in March 2021. Market experts believe the recent correction offers long-term opportunities and expect inflows to regain momentum as valuations become more attractive.