Inflows into equity oriented mutual fund schemes may have seen a fall in 2025, the first time since the sharp fall witnessed during the pandemic in 2020. Industry players attribute this to lower market returns of the past two years as well as to New Fund Offers (NFOs) not having done exceptionally well in 2025. However, they are positive on the growth going ahead as inflows into SIPs (systematic investment plans) continue to rise.
According to data from Association of Mutual Funds in India, the inflows into equity mutual fund schemes from January to November this year were `3.22 lakh crore as against a peak of Rs 3.94 lakh crore in 2024.
The NFO Fatigue: Thematic Launches Lose Their Luster
The average inflow into this category in December between 2020 and 2024 was Rs 16,078.4 crore whereas last year, the category had seen inflows of Rs 41,156 crore in December.
Venkat N Chalasani, chief executive of AMFI had noted recently that the majority of SIPs flows into equity funds. “We can definitely say that SIPs are contributing to the rebound of the equity markets,” he said.
However, Pankaj Shreshtha, head of investment services, PL Wealth Management, highlighted that investors are sticking to their SIPs in the large market cap categories but the slight dip is due to a market return of around 8-10% in 2024 and 2025.
In addition, he noted that several thematic NFOs have not garnered significant flows this year.
SIP Dominance: A Structural Rebound in Retail Participation
Data shows that 239 new fund offers raised Rs 1.19 lakh crore in 2024 compared to 221 schemes having raised Rs 63,586 crore from January – November 2025. Thematic NFOs raised Rs 21,606 crore in 2025 compared to Rs 79,109 crore in 2024.
Meanwhile, inflows into smallcap, midcap and largecap categories touched their all-time highs in 2025 at Rs 48,497 crore, Rs 45,763 crore and Rs 23,916 crore. The BSE 500 index rose 6% in 2025.