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India equity mutual funds got inflows worth Rs 19,957 crore in October, up from Rs 14,091 crore in September, and the month saw the third highest monthly inflow into equity funds in the year 2023, as per Deepak Jasani, Head of Retail Research, HDFC Securities.

Small- and mid-cap categories contributed about Rs 7,000 crore, shrugging off restrictions on lump-sum investments and new SIPs by several funds. SIP contribution to mutual funds industry in October stood at Rs 16,928 crore compared with Rs 16,420.06 crore in September, he said.

In the month of October, the equity markets continued to experience a risk-off sentiment, with the Index falling below 19,000 levels. Despite this fall, equity mutual funds continued to exhibit resilience, recording a significant net inflow of Rs 19,957 crores v/s 14,091 crores observed in September, said Akhil Chaturvedi, Chief Business Officer, Motilal Oswal AMC.

 Major flows were seen in small caps to the tune of 4,495 crores followed by thematic/sectoral funds of 3,895 crores. Hybrid funds continued to experience healthy net inflows on led by arbitrage funds and multi-asset funds. This trend reflects the prevalent risk-off sentiment in the market, with investors seeking to diversify their investments while maintaining a focus on capital protection, he said.

Domestic flows continue to prove structural. Interestingly, SIPs now account for a larger part of inflows (vs one-time investment) and are more structural. This provides the market with a lot of strength, he added.