The data captures the flow of local mutual funds related to pure equity, balanced funds, exchange traded funds (ETF), and equity-linked savings scheme (ELSS). The domestic funds sold equities worth Rs5,171 crore in April 2023; they turned out to be sellers in the secondary market for the first time in eight months. In the past 26 months, there were only two such instances.
The cumulative twelve-month rolling investment of local funds touched a 15-month low of Rs1.5 lakh crore in April. The FPIs on the other hand bought Indian equities worth Rs 11,630 crore during the period taking the two-month cumulative inflow to around Rs20,000 crore.
The gross purchase of the domestic funds was at a 21-month low of Rs75,553 crore in April. In each of the previous four months, it was above Rs1 lakh crore. Lower gross purchase in April may mean likelihood of a slower inflow during the second fortnight of the month when the Association of Mutual Funds in India (AMFI) declares the data and a possible increase in the cash balance with fund managers concerned over headwinds that may cap the market upside in the near term.
The local funds have 73% of the portfolio allocation in the top 100 companies. This proportion has grown for three quarters in a row. The domestic mutual funds have a total equity portfolio worth Rs22.60 lakh crore at the end of March 2023 accounting for 18.6% of the institutional assets under management in India.
