According to Amfi data for January, investors withdrew a net Rs 9,253.22 crore from equity-oriented fundslast month, lower than the previous month’s Rs 10,147.12 crore, thanks to a selloff in all but three categories. Equity mutual funds saw a total inflow of Rs 24,130.43 crore and an outflow of Rs 33,383.65 crore.
Flexi cap funds saw the biggest outflow at Rs 5,933.67 crore while largecap funds saw withdrawals of Rs 2,853.43 crore. Contra funds, midcap funds and smallcap funds also saw outflows of more than Rs 1,000 crore each. On the other hand, the multicap fund received net inflows of Rs 2,857.90 crore and the sectoral fund saw flows of Rs 2,586.24 crore.
Outflows during the month forced domestic institutional investors, which mostly comprise mutual fund managers, to sell a net Rs 11,970.54 crore worth of stocks, against selling of Rs 37,293.53 crore in the previous month. This is at the time FIIs poured in Rs 19,473 crore in the equity markets.
Debt mutual fund schemes were also under redemption pressure during the month as they cumulatively saw net withdrawals of Rs 33,408.76 crore. Liquid funds were the biggest drag as they saw redemptions worth Rs 45,315.69 crore. Low duration funds saw withdrawals of Rs 8,040.77 crore.
Debt funds have come under pressure as rising bond yields have negatively affected their net asset value (NAV). Analysts are advising not to invest in long-duration funds and instead, stick to short-duration ones.
The total mutual fund AUM as on January 31 dipped to Rs 30,50,130.04 crore thanks to net outflows of Rs 35,586.60 crore. BSE Sensex dipped 3 per cent during January, while BSE Midcap added 0.78 per cent and BSE Smallcap fell 0.61 per cent.
