Perspective on Monthly Mutual Fund by Sanjay Agarwal, Senior Director, CareEdge Ratings
Below the Perspective on Monthly Mutual Fund by Sanjay Agarwal, Senior Director, CareEdge Ratings
The mutual fund industry’s assets under management (AUM) fell marginally by 0.2% month-on-month to Rs 75.19 lakh crore. Inflows slipped across the board compared to July and were offset by MTM losses. Net inflow of the mutual fund industry stood at Rs 52,442.8 crore, as compared to an inflow of Rs 1.79 lakh crore the previous month.
The debt mutual fund category witnessed outflows of Rs 7,979.8 crore in August 2025 compared to the strong inflows of Rs 1.06 lakh crore in July. The outflows were driven by liquid funds, which witnessed redemptions of Rs 13,350 crore along with other categories. On the other hand, inflows were witnessed in overnight funds of Rs 4,951 crore, in money market funds of Rs 2,210.5 crore inflows, Short-duration of Rs 565 crore and low-duration funds of Rs 477 crore. This trend underlines investors’ preference for short-duration instruments amid prevailing market volatility and interest rate uncertainties, as they seek safer avenues for parking surplus funds with relatively stable returns. Credit Risk Fund category has continued to witness outflows at a steady pace.
Open-ended equity mutual funds continued their 54-month long streak of positive inflows at Rs 33,430.4 crore underscoring sustained investor confidence and consistent inflows through SIPs despite prevailing market volatility. However, Dividend yield funds recorded outflows. There lower inflows compared to July can be attributed to higher collections under NFOs of Rs 0.3 lakh crore in July. During August 2025, 23 open-ended NFOs were floated which collectively mobilised Rs.0.03 lakh crore with sectoral/thematic funds accounting for 49.7% share.
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