Mutual funds saw their highest net equity inflows in a year in March, while SIP contributions hit a new high, surpassing Rs 14,000 crore in March.

Data released by the Association of Mutual Funds of India (AMFI) showed net inflows of Rs 20,534 crore in March compared to Rs 15,686 crore in February. Sectoral/thematic schemes saw the highest inflow at Rs 3,929 crore, a category that is gaining traction as investors look for value creation.

The dividend yield category also supported equity schemes on the back of strong NFO inflows of Rs 3,716 crore in SBI MF last month. In March, the fund house raised Rs 3,600 crore for the SBI Dividend Income Fund. In February, the category saw inflows of just Rs 48 crore.

SIPs reached a record high of Rs 14,276 crore this month. SIP AUM stood at Rs 6.83 trillion in March compared to Rs 6.74 trillion in February.

N S Venkatesh, CEO of AMFI, said: “SIP inflows continue to soar, breaking records quarter-on-quarter; it is not too much to say that retail investors are the market heroes. Despite volatility due to global geopolitical reasons and inflation, the post-pandemic period witnessed the surge in investors also hints at the resilience of investor behaviour.”

On the other hand, debt schemes saw outflows of Rs 56,884 crore compared to Rs 13,815 crore in February. This is despite massive inflows of Rs 31,179 crore into the debt MF space in the last week of March after the indexation benefits of long-term funds were removed.

This was due to withdrawals of Rs 56,924 crore from liquidity and outflows of over Rs 8,000 crore, Rs 10,000 crore and Rs 11,000 crore from overnight liquidity and money market schemes, respectively. This may be because March is the end of the quarter when companies and banks typically withdraw funds to meet their prepayment tax and capital adequacy requirements.

Hybrid schemes saw inflows of Rs 24,611 crore in the month, with most of the contributions going to arbitrage funds at Rs 17,616 crore. Index funds saw inflows of over Rs 6,000 crore. Gold ETFs saw inflows of Rs 640 crore, and other ETFs saw inflows of Rs 16,476 crore.

On March 31, the industry had a NAV of Rs 39.42 trillion compared to an average AUM of Rs 40.04 trillion for the month. Retail AUM (Equity, Hybrid and Solution Oriented) was Rs 20.34 trillion in March and the average AUM was Rs 20.45 trillion.

MF portfolios reached an all-time high of 145.7 million, and retail MF portfolios also hit an all-time high.

The data shows that unique investor (first-time investor) participation increased by 11 million from March 2021 to March 2022 and 4 million from March 2022 to March 2023.

According to PAN data, female investors increased by 58.5% from 4.69 million in December 2019 to 7.45 million in December 2022.

T30 cities grew 49.1% from 2.79 million to 4.16 million over the same period. The B30 region rose 72.3% to 3.28 million from 1.9 million.

The number of people in the 18-24 age group jumped 324%, from 66,417 in December 2019 to 281,905 in December 2022. Among the 25-35 age group, that number jumped 133% to 2 million over the three years from 859,500.