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Net flows turn negative, weighed by liquid and debt schemes

* Overall net outflows came in at INR472b for Sep’21 (v/s positive flows of INR330b reported in Aug’21). This is one of the highest outflows since Sept 2020 (which saw outflows of INR521b).

* Industry flows stood at INR1.7t in FY22YTD (v/s INR2t in FY21YTD), driven by strong flows in equity and hybrid schemes.

* The number of folio additions reached all-time highs of 3.1m, driven by equity, hybrid, and other schemes. Debt and liquid funds saw a further reduction in the folio count.

* SIP flows reached new highs of INR103.5b, indicating growth of 33% YoY and 4% MoM. SIP accounts opened up during the month stood at ~2.7m.

Debt + liquid see net outflows in Sep’21

Debt flows remained negative for the second consecutive month with a much higher quantum of INR122b (v/s outflows of INR67b in Aug’21). The higher quantum of outflow was attributable to outflows in the Low Duration, Ultra Short Duration, Corporate Funds, and Banking & PSU Fund schemes. Liquid funds also saw outflows of INR568b (v/s positive flows of INR13b in Aug’21). Higher quarter-end redemptions are a normal phenomenon as corporates redeem to meet their liquidity requirements. Debt AUM remained flat MoM at INR10.5t, whereas liquid AUM saw marginal decline of 2%/1% on a YoY/MoM basis.

Equity + hybrid continues to see positive inflows

Net inflows in equity schemes continued to decline, with net inflows of INR65b (v/s INR81b in Aug’21). This was in spite of equity NFOs garnering INR66b during the month. Within the Equity categories, Multicap schemes saw the highest net inflows in Sep’21, whereas Small Cap, Dividend Yield, Value Fund, and ELSS saw net outflows. Hybrid flows stood at INR36b v/s INR187b in Aug 2021 (Aug inflows included NFOs of INR145b). Positive flows in the Hybrid category were largely led by Dynamic Asset Allocation / Balanced Advantage. Equity AUM grew 6% MoM to INR 12.8b, driven by both positive inflows and strong market performance (BSE-500 returns for the month stood at 3.3%). Hybrid AUM saw growth of 51% YoY / 7% MoM to INR4.6t.

Other schemes see net inflows, with traction in gold ETFs

Other schemes saw positive flows of INR116b (flat MoM). Index and other ETFs garnered funds via NFOs to the tune of INR12b during the month. After a weak performance in Aug’21, gold ETFs gained momentum with net inflows of INR4.5b v/s INR0.2b in Aug’21. FoF Overseas saw decline in net flows MoM to INR4.1b in Sep’21 v/s INR10.8b in Aug’21 (inflows for Aug included NFO mobilization of INR3.2b).

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