Equity Fund Contributions Drop To One-Year Low In May, AMFI Data Shows

Equity mutual funds attracted net inflows of ₹22,907 crore in May, marking the lowest monthly intake in the past 12 months, according to data released by the Association of Mutual Funds in India (AMFI). The figure was down 40% from ₹38,440 crore recorded in April, although it remained higher than the ₹19,013 crore received in May 2025.

The moderation in equity allocations came during a period of elevated volatility across global markets, driven by uncertainty surrounding developments in West Asia and a rise in crude oil prices.

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Speaking after the data release, AMFI Chief Executive Venkat Chalasani said investor participation slowed amid heightened market fluctuations and crude oil prices hovering near the $100-per-barrel mark, prompting caution in the near term.

Broad-Based Decline Across Equity Categories

Most equity funds segments reported lower inflows during the month. Large-cap funds received ₹1,592.93 crore, down from ₹2,524.6 crore in April. Mid-cap fund inflows declined to ₹4,385.06 crore from ₹6,551.4 crore, while small-cap funds attracted ₹4,945.57 crore compared with ₹6,885.9 crore in the previous month.

Despite the slowdown, all three categories continued to record positive net investments, indicating that investor interest in equities remained intact, albeit at a reduced pace.

The mutual fund industry’s total assets under management (AUM) stood at ₹81.58 lakh crore at the end of May, compared with ₹81.92 lakh crore a month earlier, AMFI data showed.

Debt Funds Witness Sharp Outflows

Debt mutual funds experienced significant redemptions during May, posting net outflows of ₹96,948 crore against inflows of ₹2.47 lakh crore in April.

Liquid funds saw the largest withdrawal at ₹29,680 crore, followed by money market funds, which recorded net outflows of ₹24,691.74 crore.

Corporate bond funds also moved into negative territory, registering outflows of ₹7,009.94 crore after receiving ₹6,196.5 crore in April. The credit risk category was the only one to remain in the positive, with net inflows of ₹49.5 crore.

Hybrid & Passive Sectors Lose Momentum

There were net investments of ₹10,560.24 crore in the hybrid sector, marking a decline of close to 49% from the last month's total of ₹20,565.2 crore. Arbitrage was the best performing sub-category, recording net inflows of ₹5,697 crore, while the multi asset allocation category saw inflows of ₹3,928 crore. Balanced hybrid funds received ₹655.24 crore, while dynamic asset allocation funds attracted ₹181 crore.

Passive investment categories also saw a steep slowdown. Inflows into index funds, gold ETFs and other ETFs fell 98% month-on-month to ₹361.99 crore from ₹20,082 crore in April.

Gold ETFs registered net outflows of ₹725.04 crore, while other ETFs saw withdrawals of ₹620.22 crore. Index funds attracted ₹943.26 crore, and overseas fund of funds received net inflows of ₹763.99 crore during May.