Inflows into equity schemes in the month of October hit lowest since June even as the benchmark equity indices rose nearly 5% during the month. However, the contribution of systematic investment plans (SIPs) continued to swell and hit an all-time high of Rs 29,529.27 crore with contributions from 94.52 million accounts.
Overall, the inflows into equity schemes recorded a four-month low of Rs 24,690 crore, down 19% from September. The worst hit was the large cap category, which fell the most month-on-month by 58%, multi-cap fell nearly 30%, while midcap and small cap saw a month-on-month fall of 25% and 20% respectively. Sectoral and thematic schemes saw a 12% rise in inflow to Rs 1,399 crore. Redemption in equity schemes was highest since July 2024 in October at Rs 38,920.83 crore.
Venkat N Chalasani, Chief Executive, AMFI, said that in August, the positive sentiment in the market was driven by expectations of the US Federal Reserve reducing interest rates, some positive talks about progress of US-China trade, a bit of strong corporate earnings and domestic demand on account of the festive season. However, calling this a one-off, he said some profit booking happened as we have seen returns remaining stable compared to the last two years.
Himanshu Srivastava, Principal Research, Morningstar Investment Research India, noted this was now the third consecutive month which witnessed moderation in net inflows into the equity categories. “The moderation in net inflows could be attributed to profit booking by investors given the sharp surge in the equity markets along with the festive season,” he added.
According to him, the rise in inflows to sectoral and thematic was largely driven by the launch of four new fund offerings, which together mobilised around Rs 2,489 crore. He said: “Excluding these new launches, the category would have actually seen net outflows, indicating a slowdown in investor enthusiasm. The moderation suggests that investors engaged in some profit-booking and have turned more selective after the strong cyclical and theme-based rallies that fueled record subscriptions in earlier months.” Overall, 18 new fund offers mobilised Rs 6,062 crore.
Vaiibhavv Chugh, CEO, Abakkus Mutual Fund said that the lower flows should be sidelined as spending activities become mainstream owing to the festivities over the investments. “Also, ambiguities around the tariff discussion outcome would have compelled investors to defer making investment calls from a short-term perspective,” he added.
Meanwhile, inflow into debt schemes were robust at Rs 1.6 lakh crore, highest since April. Nehal Meshram, Senior Analyst, Morningstar Investment Research India said the turnaround was largely driven by robust inflows into liquid and overnight funds, as institutional investors redeployed surplus cash after the quarter-end outflows observed in the previous month. “Going forward, fund flows are likely to remain concentrated in liquid, money market, and high-quality accrual categories, with investors awaiting more clarity on the timing and pace of future rate cuts before extending duration exposure,” she added.
Chalasani said that during the month, SIFs have seen a debut giving options beyond just mutual funds for the mass affluent segment of investors. The Net AUM of this segment as of Oct 2025 is Rs 2,010.44 crores. The total number of folios stood at 10,212, with net inflows of Rs 2,004.56 in Oct 2025. Among the schemes fund houses that launched SIFs in October are Edelweiss, SBI, and Quant.
Mutual Fund Industry’s Net AUM stands at Rs 79.87 lakh crores for the month of October 2025and the SIP AUM was Rs 16.25 lakh crores for the month of October 2025, 20.3% total mutual fund industry’s assets.
