India equity mutual fund inflows rebound from one-year low

FE Team | Published: July 11, 2026 21:06:11

Flows to India's equity mutual funds jumped 26.5 per cent month-on-month in June, from their lowest in a year, as easing Middle East tensions and rupee-stabilising measures lifted sentiment, reports Reuters.
This marks five years and four months of net inflows to equity mutual funds, the longest streak on record.
Inflows climbed to 289.73 billion rupees ($3.04 billion) from 229.08 billion rupees in May, data from the Association of Mutual Funds in India showed on Friday.
Large-cap, mid-cap and small-cap funds registered sequential increases in flows of 34 per cent, 39 per cent and 13 per cent respectively.
"Rising equity inflows show investors are willing to look past near-term global shocks from the Iran conflict and stay focused on the underlying strength of the Indian economy," said Aishvarya Dadheech, founder and chief investment officer at Fident Asset Management.
"Strong credit growth, healthy GST collections and resilient nominal GDP all point to the possibility of earnings upgrades."
India's benchmark Nifty 50 tab index rose 1.4 per cent in June, while small-caps and mid-caps gained 4 per cent and 0.1 per cent, respectively.
Greater comfort on valuations and expectations of an earnings recovery in the second half of the year are driving stronger flows into broader markets, where mid- and small-caps offer meaningful alpha, analysts at stock broker SMC Global and portfolio management service Fident said.
Systematic investment plans, the preferred route for retail investors, marked a 3 per cent increase in flows to 317.81 billion rupees, just shy of a record 320.87 billion rupees in March.
Inflows to gold exchange-traded funds rose to 34.43 billion rupees, a month after seeing record outflows of 7.25 billion rupees in May, when India raised import tariffs on gold and silver to 15 per cent from 6 per cent to curb imports and ?ease pressure on foreign exchange reserves.
AMFI Chief Executive Venkat Chalasani said the pullback in gold prices after a strong run made gold ETFs more attractive, drawing
investors back into the category.