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Large-cap equity funds see first monthly outflow in nearly 3 years
July equity mutual fund net inflows fell 15.7% to ₹24,685 crore, while small-cap funds drew ₹7,767 crore inflows and mid-cap funds added ₹6,192 crore.
Investors rotated within India’s equity mutual fund market in July, with large-cap funds recording net outflows of ₹1,321 crore, the first monthly outflow in nearly three years, according to data cited by LiveMint Markets from the Association of Mutual Funds of India.
Overall, monthly net inflows into equity mutual funds slowed 15.7% to ₹24,685 crore. LiveMint Markets reported that small-cap funds attracted ₹7,767 crore in net inflows during the month, while mid-cap funds gained ₹6,192 crore.
The shift was also visible versus the 12-month average, LiveMint Markets said, with large-cap funds seeing a 164% decline in net flows in July. In contrast, inflows into small-cap funds rose 61%, and mid-cap fund inflows increased 27%.
LiveMint Markets attributed the change in part to retail investors becoming more selective and pursuing concentrated domestic risk in search of alpha, while large-cap flows weakened. The outlet also pointed to broader sentiment effects from the US-Iran war, which began on 28 February, as investors appeared to adjust to its prolonged nature, with hybrid equity categories like balanced advantage funds and equity savings funds seeing reduced inflows in July.