Resilient SIP Flows Exceed 32,000 Crore in October Despite Market Volatility

MUMBAI: Retail investors in India are demonstrating increased maturity in their investment strategies, focusing on stocks at lower prices while maintaining steady investments through systematic investment plans (SIPs). In October, gross monthly SIP flows reached Rs 32,160 crore, just shy of the previous month’s record of Rs 32,490 crore, according to data released by the Association of Mutual Funds in India (AMFI).

Investors continued to favor large-cap and mid-cap schemes, although there was a slight decrease in investments in small-cap funds. The first half of October was challenging for the market, with the Sensex dropping to a two-year low below 72,000. However, the index rebounded in the last week of the month, driven by foreign fund buying.

Net inflows into all equity funds totaled Rs 32,994 crore in October, marking the 68th consecutive month of net inflows, despite a 14% decline from September’s Rs 38,307 crore. The total assets under management (AUM) in the industry rose by 1.2% to Rs 83.4 lakh crore from Rs 82.6 lakh crore the previous month.

According to Navneet Munot, MD & CEO of HDFC Mutual Fund, the resilience of net inflows into equity-oriented funds and SIPs persisted amid market volatility. He noted that gross redemptions from equity-oriented funds were at Rs 32,588 crore, the lowest in recent months. Munot emphasized that Indian investors are increasingly viewing volatility as a normal part of the investment process.

Saugata Chatterjee, president and deputy CEO of Nippon India Mutual Fund, highlighted the positive trend in large-cap inflows, suggesting that investors are balancing their exposure across different market capitalizations as valuations become more attractive. While inflows into small-cap and mid-cap funds moderated, they remained strong, reflecting ongoing investor confidence in India’s long-term economic growth.

In October, the mutual fund industry as a whole saw net inflows of approximately Rs 1.7 lakh crore, a significant turnaround from the net outflows of Rs 1.3 lakh crore in September. Hemant Kumar, chief business officer at Tata Mutual Fund, attributed this shift to the usual quarter-end phenomenon, with fixed income funds experiencing inflows of Rs 1.1 lakh crore after a Rs 1.8 lakh crore outflow in September.