mutual fund flows

May Fortnight Review: FPIs Stay Risk-Off in Equities; FPI Debt Turns Positive, DIIs & MFs Cushion Pressure

FPIs Remain Selectively Risk-Off in First Half of May; Services Sees Buying, Financials Face Heavy Selling

FPI Selling: Financial Services Leads the Outflows – During 1st–15th May 2026, FPI selling remained concentrated in Financial Services, which saw the highest outflow of ₹17,960 Cr, making it the biggest drag during the fortnight. Selling was also seen in Oil & Gas at ₹6,885 Cr, followed by Telecom at ₹2,542 Cr, Information Technology at ₹1,643 Cr, FMCG at ₹1,625 Cr, Construction Materials at ₹1,207 Cr, Consumer Durables at ₹1,162 Cr and Power at ₹1,157 Cr. This indicates that FPIs continued to reduce exposure across key large-cap, consumption and rate-sensitive sectors.

FPI Buying: Selective Interest in Services and Capital Goods – On the buy side, FPI buying was relatively selective, led by Services, which attracted inflows of ₹7,019 Cr. Capital Goods also saw healthy buying of ₹2,645 Cr, followed by Metals & Mining at ₹1,698 Cr, while Diversified saw marginal inflows of ₹33 Cr.

FPIs Stay Risk-Off in First Half of May: FPIs remained net sellers in Indian equities during 1st–15th May 2026, recording outflows of ₹27,048 Cr. The pressure came mainly from the secondary market, where FPIs sold ₹27,178 Cr, while the primary market/IPOs saw small buying of ₹130 Cr. This shows that foreign investors continued to stay cautious in listed equities, even as IPO participation remained marginally positive.

DII Buying Remains Robust: Domestic Institutional Investors continued their strong buying momentum in the first half of May 2026, with net equity purchases of ₹39,917 Cr during 1st–15th May. For CY2026 till 15th May, DIIs have invested a strong ₹3,41,586 Cr in Indian equities, reinforcing their role as the key stabilising force as persistent FPI selling continues to weigh on market sentiment.

MF Equity Buying Remains Strong: Mutual Funds emerged as the major buyer within DIIs during 1st–15th May 2026, investing ₹33,191 Cr in equities against total DII buying of ₹39,917 Cr. This means MFs contributed nearly 83% of total DII equity inflows during the fortnight. On a CY2026-to-date basis, MFs have invested ₹2,16,307 Cr in equities.

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

Equity MF AUM Stages Strong Comeback as Industry Assets Rebound Broadly: Equity mutual funds’ Net AUM rebounded sharply in April, rising to ₹35.74 lakh crore from ₹31.98 lakh crore in March, reflecting an ~11.8% MoM increase. The recovery was supported by improved equity market sentiment, portfolio valuation gains and sustained investor participation. Overall mutual fund industry Net AUM also rose 11.11% MoM to ₹81.92 lakh crore, aided by equity market recovery, strong debt inflows and post year-end treasury redeployment.

Mutual Funds Added Fresh Exposure Across Consumption, Financials, Exchanges, Metals and Industrials: Equity mutual funds added fresh positions in a diversified set of stocks led by Titan Company, Radico Khaitan, 360 One WAM and BSE, reflecting selective interest across consumer discretionary, alcohol/consumption, wealth management and market infrastructure themes. Incremental additions were also visible in Varun Beverages, Steel Authority of India, Axis Bank, RBL Bank, MCX, Nippon Life India AMC and ABB India, indicating broad-based accumulation across consumer beverages, IT services, metals, private banks, exchanges, asset management and industrial automation/capital goods.

Mutual Funds Pare Exposure Across Metals, Banking, IT, Energy and Auto Names Amid Portfolio Rotation: On the exit side, equity mutual funds reduced or exited positions most notably in Vedanta, HDFC Bank, HCL Technologies and ICICI Prudential AMC, indicating portfolio reshuffling across metals & mining, private banking, IT services and asset management. Other notable reductions were seen in LG Electronics India, Reliance Industries, Wipro, Hyundai Motor India and Mahindra & Mahindra, reflecting continued churn across consumer durables, energy/conglomerates, automobiles and technology exposures.

Eternal, ICICI Bank & Shriram Finance Lead MF Buying; BFSI, Auto, Pharma and IT Names Also Attract Net Adds: In the Top 20 traded stocks, equity mutual funds recorded the strongest net additions in Eternal, ICICI Bank, Shriram Finance, SBI Life Insurance, Maruti Suzuki, State Bank of India, Sun Pharma and Infosys, reflecting continued preference for new-age consumption, private banking, NBFCs, insurance, automobiles, PSU banking, pharmaceuticals and IT services. Incremental buying was also visible in Larsen & Toubro, Tata Consultancy Services, Hindustan Unilever and Axis Bank, indicating steady allocation toward large-cap leaders, core franchises and selective growth opportunities.

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

Mutual Funds Deploy Cash Gradually Amid Sharp Market Gains in April: Mutual funds reduced the pace of equity buying in April, investing ₹30,594 crore during the market rebound, significantly lower than the record ₹98,746 crore buying in March. Meanwhile, cash holdings rose to ₹1.98 lakh crore from ₹1.86 lakh crore. However, the cash-to-AUM ratio edged lower, indicating that the sharp market rebound expanded equity AUM faster than cash accumulation, while deployment remained gradual.

AMC Cash Levels Ease, but Caution Persists: The average cash holding ratio across the top 20 AMCs eased to 5.03% in April from 5.16% in March, as equity-oriented AUM rose faster than absolute cash holdings, supported by gains in Indian equities. However, with cash levels still near 5%, fund managers appear to be maintaining a cautious stance while retaining liquidity to manage volatility and capture emerging opportunities.

PPFAS Mutual Fund holds the highest cash-to-AUM ratio at 18.71% with ₹27,559 Cr in cash, reflecting a distinctly defensive stance with strong flexibility for future deployment. Quant MF follows with a notable 14.38% cash holding or ₹12,076 Cr, while Axis MF also maintains an elevated cash buffer at 7.60% or ₹14,870 Cr, indicating a cautious yet opportunity-driven investment approach.

Flexi Cap Funds Lead in Absolute Cash Stash: Parag Parikh Flexi Cap Fund holds the highest cash buffer at ₹27,035 Cr, with cash forming 19.18% of AUM, signalling a defensive yet opportunity-ready stance. HDFC Flexi Cap Fund follows with ₹7,177 Cr in cash, or 7.14% of AUM, indicating liquidity available for tactical deployment as market conditions evolve.

Contra & Flexi Cap Funds Remain Cash Leaders: Contra Funds continue to top the liquidity spectrum with an 11.71% cash-to-AUM ratio and ₹8,418 Cr cash holding, reflecting a cautious yet opportunity-oriented stance. Flexi Cap Funds follow with 8.45% in cash or ₹47,314 Cr, underscoring their flexibility to dynamically allocate across market segments as opportunities evolve.

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

The mutual fund industry recovered strongly in April 2026, with Average AUM rising to ₹81.94 lakh crore from ₹79.46 lakh crore in March, supported by total net inflows of ₹3.22 lakh crore, largely led by heavy debt inflows.

Equity-oriented inflows moderated by 5% to ₹38,440 crore in April, weighed by near-term caution from higher crude prices amid the Iran conflict and fewer working days, even as broader investor conviction stayed intact.

Hybrid funds witnessed a sharp turnaround with net inflows of ₹20,565 crore, driven by a strong reversal in Arbitrage funds as institutional money returned post the year-end pullout.

Passive fund inflows moderated to ₹20,082 crore as Index Funds and Other ETFs normalised, while Gold ETFs attracted steady inflows on safe-haven demand and FoFs investing overseas saw a sharp uptick.

Debt mutual funds recorded an all-time high monthly net inflow of ₹2.47 lakh crore, with record inflows of ₹1.65 lakh crore into liquid funds, as corporates redeployed treasury cash withdrawn in March for advance tax and GST payments.

SIP inflows eased marginally to ₹31,115 crore from March’s record level, but remained historically strong, reflecting sustained retail commitment.

Overall, April 2026 reflects a strong post financial year-end normalisation, with record debt inflows, resilient equity participation, and steady SIP momentum lifting industry AUM higher.

April 2026: FPIs Extend Equity & Debt Selloff, While DIIs & Mutual Funds Continue to Anchor Market Support

April 2026 Sectoral Rotation: Financials Face Heavy FPI Selling; Power and Capital Goods See Selective Buying

Financial Services Leads the Selloff; Consumer Services, Healthcare and Oil & Gas Also Remain Under Pressure: On the selling side, Financial Services remained the biggest drag by a wide margin, witnessing outflows of ₹30,856 Cr, with selling continuing across both halves of the month at ₹19,152 Cr and ₹11,704 Cr, respectively.

Consumer Services saw the second-highest selling at ₹7,770 Cr, followed by Healthcare at ₹6,926 Cr and Oil & Gas at ₹6,703 Cr. Among other sectors, Automobile (₹5,479 Cr), Telecommunication (₹4,400 Cr), IT (₹4,212 Cr) and FMCG (₹3,205 Cr) also witnessed outflows, indicating broad-based FPI caution across both cyclical and defensive sectors.

Power and Capital Goods Emerge as Key Buying Pockets: FPI buying in April 2026 remained selective, with Power leading inflows at ₹5,557 Cr, supported by strong buying of ₹4,956 Cr in the second half of the month. Capital Goods followed with inflows of ₹4,339 Cr, as FPIs turned buyers in the second half after mild selling in the first half. Metals & Mining (₹1,218 Cr) and Construction (₹926 Cr) also saw positive flows. Overall, the trend suggests that FPIs stayed cautious in April, but continued to prefer Power, Capital Goods and select domestic capex-linked themes.

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

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.