India equity mutual funds record 12‑month low inflow amid market volatility

Equity‑oriented mutual fund schemes in India attracted a net inflow of Rs 22,908 crore in May, the lowest level in a year and a 40 % decline from the Rs 38,440 crore recorded in April. The drop came as heightened volatility linked to the West Asia crisis and soaring crude‑oil prices dampened investor sentiment. Overall, the mutual‑fund industry posted a net outflow of more than Rs 64,000 crore in May, pulling the sector’s assets under management down to Rs 81.6 lakh crore, slightly below the Rs 81.92 lakh crore a month earlier.

Within the equity category, Flexi‑Cap funds led with a Rs 5,175 crore inflow, followed by Small‑Cap (Rs 4,945 crore) and Mid‑Cap (Rs 4,385 crore) funds. Large‑Cap funds saw a modest Rs 1,593 crore inflow, while Dividend Yield Funds and ELSS schemes registered outflows. Gold ETFs also moved into net outflow territory, shedding Rs 725 crore. Analysts attributed the cautious stance to geopolitical uncertainty, elevated oil prices and persistent inflation, with comments such as, “The moderation in equity mutual‑fund inflows reflects a more cautious investor sentiment amid heightened geopolitical uncertainty,” noting the shift in risk appetite.