Cash Holdings Rise Despite Aggressive Buying: Equity mutual funds increased cash reserves to ₹2.07 lakh crore in July 2025, up from ₹2.04 lakh crore in June, even as they bought equities worth ₹47,019 crore in July. The rise was aided by record inflows and a drop in equity valuations during the market correction.
AMC Cash Ratios Breach 5% Mark: The average cash holding ratio among the top 20 AMCs climbed to 5.94% in July from 4.88% in June, decisively crossing the 5% level. This reflects a cautious stance, with fund managers prioritising liquidity over full equity deployment amid uncertain market conditions.
Cash-Heavy Mutual Funds: PPFAS Tops with 21.36%, SBI Holds ₹34,592 Cr –SBI Mutual Fund holds the largest cash pile at ₹34,592 crore (4.75% of AUM), followed by ICICI Prudential MF with ₹27,999 crore (5.98%). HDFC MF ranks close with ₹27,031 crore (6.43%), reflecting substantial liquidity positions among the biggest fund houses. PPFAS MF stands out with the highest cash-to-AUM ratio at 21.36% (₹25,375 crore), followed by Quant MF at 9.12% (₹7,978 crore) and Motilal Oswal MF at 8.61% (₹9,031 crore), signalling a notably cautious approach.
Parag Parikh & SBI Contra Lead in Cash Proportion: Parag Parikh Flexi Cap Fund tops with 21.66% of AUM in cash (₹24,532 crore), followed by SBI Contra Fund at 19.86% (₹9,325 crore) and Motilal Oswal Midcap Fund at 17.96% — signalling a strong liquidity stance to deploy capital when opportunities arise.
Contra & Flexi Cap Funds Lead the Cash Pile: Contra Funds hold the largest liquidity cushion in terms of percentage with 15.14% of AUM in cash (₹10,706 crore), followed by Flexi Cap Funds at 9.67% (₹47,698 crore). This indicates a defensive stance, keeping ample cash to capitalise on market corrections.
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