Month: April 2026

April Fortnight Review: FPIs Sell Aggressively Across Equity & Debt, DIIs and MFs Provide Support

FPIs Stay Highly Risk-Off in First Half of April; Financials See Heavy Unwind, Buying Limited to Power

FPI Selling: Financial Services Leads the Outflows – During 1st–15th April 2026, FPI selling was heavily concentrated in Financial Services, which saw massive outflows of ₹19,152 Cr, making it the biggest drag during the fortnight. Selling was also strong in Consumer Services (₹5,336 Cr) and Healthcare (₹4,481 Cr), followed by Automobile & Auto Components (₹3,704 Cr), Oil, Gas & Consumable Fuels (₹3,352 Cr), FMCG (₹2,976 Cr), Telecommunication (₹2,492 Cr) and Realty (₹1,917 Cr). This reflects a broad-based risk-off trend, with FPIs reducing exposure across key large-cap and consumption-linked sectors.

FPI Buying: Selective and Very Limited – On the buy side, FPI interest remained extremely selective, with Power attracting ₹601 Cr of inflows. Other buying was negligible, with Diversified at ₹5 Cr and Utilities at ₹4 Cr, indicating that FPIs largely stayed away from fresh sectoral allocations during the fortnight.

FPIs Stay Risk-Off in Early April: FPIs remained aggressive sellers in Indian equities during the first half of April 2026, recording net outflows of ₹48,139 Cr between 1st–15th April. Selling was consistent, with only one buying day in nine trading sessions, reflecting continued caution toward Indian markets. While primary market flows stayed positive at ₹726 Cr, the pressure came from the secondary market, where FPIs sold ₹48,865 Cr, signalling sustained risk-off sentiment in listed equities. Despite aggressive FPI selling, domestic liquidity and sharp index recovery kept market sentiment resilient in the first half of April.

DII Buying Remains Robust: Domestic Institutional Investors continued their strong buying momentum in the first half of April 2026, with net equity purchases of ₹37,846 Cr during 1st–15th April. For CY2026 so far, DIIs have invested a strong ₹2,88,450 Cr in Indian equities, reinforcing their role as the key stabilising force in the market.

MF Equity Buying Holds Firm: Mutual Funds remained net buyers in equities during 1st–15th April 2026, investing ₹18,402 Cr. On a CY2026-to-date basis, MFs have invested ₹1,70,925 Cr in equities, providing a strong domestic cushion amid continued FPI selling pressure.

For a comprehensive understanding and more insights, please go through our detailed report.

Equity MF AUM Sees Sharp March Correction as Overall Industry Assets Also Retreat: Equity mutual funds’ Net AUM fell sharply to ₹31.98 lakh crore in March from ₹35.39 lakh crore in February, reflecting a steep 9.66% MoM decline amid the broader equity market correction. At the same time, the overall mutual fund industry’s Net AUM also declined significantly by 10.11% MoM to ₹73.73 lakh crore from ₹82.03 lakh crore. The decline in industry assets was broad-based, driven by heavy debt outflows and a market-led fall in equity valuations during the month.

Mutual Funds Added Fresh Exposure Across Telecom, Financials, Energy and Cyclicals: Beyond the IPO addition, mutual funds added a diversified set of names led by Bharti Airtel, Shriram Finance, Oil India, Tata Steel and InterGlobe Aviation. Incremental additions were also seen in ONGC, NTPC, Coal India, Sun Pharma, BSE, Mahindra & Mahindra, Eternal and Hindalco, indicating broad-based buying across telecom, lenders, energy, industrials, metals, autos and healthcare.

Mutual Funds Back March’s IPO Addition; Sedemac Mechatronics Draws Strong Debut Interest: Sedemac Mechatronics Ltd. emerged as the standout IPO addition in March 2026, with 30 equity mutual fund schemes initiating exposure with aggregate holdings bought amounting to 11.44%, making it the most notable fresh entry during the month.

Mutual Funds Exited Select Consumer, Financial, Auto and Energy Names Amid Portfolio Rotation: On the exit side, schemes pared or exited holdings in stocks led by Meesho Ltd., HPCL and BPCL, while other notable exits were seen in Kwality Wall’s (India), ICICI Lombard, HDB Financial Services, Maruti Suzuki, Tata Motors, Bajaj Auto, ICICI Prudential AMC, Bajaj Finance, Hero MotoCorp, Cholamandalam Investment, IDFC First Bank and Cummins India. This suggests ongoing portfolio churn and sector rotation across consumer, financial, auto and energy exposures.

InterGlobe Aviation, Shriram Finance & Eternal Lead Mutual Fund Buying; Private Banks and Telecom Also See Strong Net Adds: With mutual funds posting record buying in Indian equities, March saw net accumulation in most of the top traded stocks. Equity mutual funds showed the strongest net accumulation in InterGlobe Aviation, followed by Shriram Finance, Eternal, Bharti Airtel and HDFC Bank. Strong net additions were also visible in Kotak Mahindra Bank, ICICI Bank, Infosys, Mahindra & Mahindra, Coal India and Axis Bank, reflecting continued preference for financials, telecom, travel, consumption, and selective growth-oriented large caps. Incremental buying was further seen in NTPC, Reliance Industries, ONGC, Sun Pharma, L&T, HCL Technologies, and Bajaj Finance, indicating broad-based participation across key sectors.

For a comprehensive understanding and more insights, please go through our detailed report.

Mutual Funds Deploy Cash Aggressively Amid Market Correction: Mutual funds turned record buyers in Indian equities in March, investing ₹98,746 crore, the highest-ever monthly buying, as they used the market correction to deploy money actively. Meanwhile, cash holdings declined to ₹1.86 lakh crore from ₹2.10 lakh crore in February. As a result, the cash-to-equity AUM ratio edged lower, indicating stronger equity deployment despite healthy inflows.

AMC Cash Levels Ease, but Caution Persists: The average cash holding ratio across the top 20 AMCs eased to 5.16% in March from 5.39% in February, reflecting higher cash deployment as market opportunities improved. However, with equity AUM under pressure and the ratio still above 5%, fund managers appear to be maintaining a cautious stance while retaining sufficient liquidity to manage volatility and capitalise on emerging opportunities.

PPFAS Mutual Fund holds the highest cash-to-AUM ratio at 21.76% (₹29,327 Cr), reflecting a distinctly defensive stance with strong flexibility for future deployment. Quant MF follows with a notable 13.82% (₹10,005 Cr), while Axis MF (9.31%) and Bandhan MF (6.31%) also maintain relatively elevated cash allocations, indicating a cautious yet opportunity-driven investment approach.

Flexi Cap Funds Lead in Cash Intensity: Parag Parikh Flexi Cap Fund holds the highest cash-to-AUM ratio at 22.25% (₹28,698 Cr), signalling a defensive yet opportunity-ready stance. HDFC Flexi Cap Fund follows with ₹6,327 Cr in cash, or 6.93% of AUM, indicating liquidity available for tactical deployment as market conditions evolve.

Contra, Focused & Small Cap Schemes Hold Strong Buffers: SBI Contra Fund maintains high liquidity at 16.33% (₹7,143 Cr), reflecting a cautious yet opportunistic approach. SBI Focused Fund holds 10.58% (₹4,206 Cr) in cash, while SBI Small Cap Fund and HDFC Small Cap Fund maintain 11.76% and 10.30% respectively, highlighting prudent buffers amid market volatility.

For a comprehensive understanding and more insights, please go through our detailed report.

The mutual fund industry witnessed a decline in March 2026, with Average AUM falling to ₹79.46 lakh crore from ₹83.42 lakh crore in February, impacted by net outflows of ₹2.40 lakh crore, largely driven by significant debt outflows and equity market correction.

Equity-oriented mutual fund inflows rose sharply to ₹40,450 crore, reaching an 8-month high, reflecting continued investor interest despite volatile market conditions. Among equity schemes, flexi-cap funds remained the top inflow category, while mid-cap funds, flexi-cap funds and large & mid-cap funds saw record high ever inflows, reflecting strong preference for diversified and growth-oriented strategies.

Passive fund inflows surged to ₹30,768 crore, driven by strong contributions from index funds and other ETFs, while gold ETF inflows moderated, indicating a shift towards broader market-linked strategies.

SIP inflows touched a record high of ₹32,087 crore, highlighting sustained strength in retail investor participation.

Hybrid funds witnessed significant outflows of ₹16,538 crore, primarily due to heavy redemptions from arbitrage funds, which weighed on overall category flows.

Debt mutual funds saw a sharp reversal, recording net outflows of ₹2.95 lakh crore, largely due to year-end factors such as advance tax payments, GST obligations, and institutional treasury adjustments.

Overall, the March 2026 flow pattern indicates that while equity and SIP inflows remained strong, seasonal debt outflows and market correction impacted overall industry assets, reflecting a mix of long-term investor confidence and short-term liquidity-driven movements.

For more details, read our March 2026 Mutual Fund Flow Report.

March 2026: FPIs Witness Record Equity Selling, While DIIs & Mutual Funds Surpass Their Previous Buying Record of October 2024

March 2026 Sectoral Rotation: Financials and Autos See Heavy Selling Pressure; FPIs Stay Selective in Capital Goods

Financial Services Leads the Selloff; Autos, Construction and Defensives Also Under Pressure: On the selling side, Financial Services remained the biggest drag by a wide margin, witnessing massive outflows of ₹60,655 Cr, with selling persisting across both halves of the month at ₹31,831 Cr and ₹28,824 Cr, respectively. Automobile saw the second-highest outflows at ₹12,498 Cr, with selling intensifying sharply in the second half to ₹7,691 Cr from ₹4,807 Cr in the first.

Construction too remained under pressure, with net outflows of ₹9,154 Cr, including a sharper ₹6,179 Cr selloff in the latter half. Among other sectors, Telecommunication (₹5,603 Cr), FMCG (₹5,419 Cr), Realty (₹4,693 Cr), Healthcare (₹4,638 Cr) and Oil & Gas (₹4,129 Cr) also saw persistent selling, reflecting a broad-based foreign retreat across both cyclicals and defensive segments in March.

Capital Goods Emerges as the Only Meaningful Buying Pocket – FPI buying in March 2026 was extremely selective, with Capital Goods emerging as the only sector to witness net inflows of note at ₹3,148 Cr. Buying, however, was largely front-loaded, with strong inflows of ₹3,897 Cr in the 1st–15th March, followed by net selling of ₹749 Cr in the 16th–31st March, indicating that even in their preferred capex-linked segment, foreign investors turned more cautious toward the latter half of the month. The overall pattern suggests that while FPIs retained some preference for the domestic capex theme, broader risk appetite remained weak in March.

For a comprehensive understanding and more insights, please go through our detailed report.

Mutual Fund Industry AAUM Surges to a Record ₹81.54 Lakh Crore Despite Q1 CY26 Equity Market Turbulence

Fresh Peak for Average AUM on Strong Inflows & SIP Momentum: Despite the sharp selloff in equity markets and persistent global uncertainties, the mutual fund industry’s Average AUM rose to a record ₹81.54 lakh crore in the January–March 2026 quarter, reflecting a strong 20.36% YoY growth and a 0.65% QoQ increase. During the quarter, mutual funds invested around ₹1.5 lakh crore, underscoring continued confidence in the market despite near-term volatility. The robust growth in AAUM highlights the industry’s resilience, supported by strong inflows, rising retail participation, and steady SIP momentum, which continues to strengthen long-term investing behaviour. The sequential rise in AAUM also reflects the mutual fund industry’s expanding footprint and growing relevance in India’s evolving investment landscape.

SBI MF Retains Top Spot: SBI Mutual Fund continued to hold its leadership position with an AAUM of ₹12.48 lakh crore in the January–March 2026 quarter, remaining largely stable after touching a record ₹12.49 lakh crore in the previous quarter. This also marks the 25th consecutive quarter of SBI MF retaining its position as India’s largest fund house, highlighting strong and sustained investor confidence in the franchise. Notably, SBI Mutual Fund and ICICI Prudential Mutual Fund remain the only two AMCs in India with an Average AUM exceeding ₹11 lakh crore.

AAUM Growth Leaders Shine in Q1CY26: The mutual fund industry’s leading players delivered a healthy performance in the January–March 2026 quarter, with ICICI Prudential Mutual Fund posting the highest absolute increase in Average AUM at ₹27,371 crore. The quarter also saw strong traction across other prominent fund houses, as Nippon India, Kotak Mahindra, PPFAS and Zerodha Mutual Fund emerged as notable contributors to the industry’s overall AAUM expansion. Their performance highlights the continued strength of select franchises in attracting investor flows despite a volatile market backdrop.

Rankings Hold Firm, Top 10 Sees a Shift: The mutual fund industry continued to exhibit strong structural stability in the January–March 2026 quarter, with the top 3 as well as the top 8 fund houses retaining their positions for the 19th consecutive quarter. However, the top 10 rankings witnessed a notable change, as DSP Mutual Fund re-entered the list by overtaking Mirae Mutual Fund, which moved out of the top 10 by Average AUM.

Rising AMCs Gain Ground: Several fund houses improved their standings in the January–March 2026 quarter, with Abakkus, Jio BlackRock, Zerodha, WhiteOak and Helios Mutual Fund moving up the rankings, indicating steady progress over previous quarters. The standout development was Abakkus Mutual Fund, which made its debut through NFO launches during previous quarter, built an AAUM of ₹3,129 crore, and closed the period at 41st position among 51 AMCs.

For a comprehensive understanding and more insights, please go through our detailed report.