Investor participation through systematic investment plans (SIPs) strengthened in June, with the mutual fund industry recording the highest net monthly increase in contributing SIP accounts since February 2026.
The industry registered 5.55 million new SIPs during the month against 5.06 million discontinuations, resulting in a net addition of 487,000 contributing SIP accounts. The SIP stoppage ratio — the proportion of discontinued SIPs to new registrations — declined to 91.23% from 95.46% in May, the lowest level in four months.
Monthly SIP contributions rose to Rs 31,781 crore, the second-highest on record after the all-time high of Rs 32,087 crore in March. Supported by stronger inflows and improved market performance, the mutual fund industry’s assets under management (AUM) increased to a record Rs 82.22 lakh crore in June from Rs 81.58 lakh crore in May.
The improvement in SIP activity coincided with a rebound in equity mutual fund inflows, which rose more than 26% after nearly 40% decline in May. Mid-cap and small-cap funds attracted the highest net inflows of Rs 6,090 crore and Rs 5,602 crore, respectively. While inflows into mid-cap schemes surged around 40 per cent month-on-month, those into small-cap funds rose about 13 per cent. The categories also benefited from gains of 1.4% and 5.3%, respectively, in their benchmark indices during the month.
Flexi-cap funds continued to attract robust inflows, while sectoral/thematic and multi-cap funds staged a strong recovery, with inflows rising 127% and 34%, respectively.
“The increase in inflows across large-cap, mid-cap and small-cap funds suggests investors are participating across the market-cap spectrum rather than chasing a single pocket of the market,” said Suranjana Borthakur, Head of Distribution, Mirae Asset Investment Managers (India).
Equity-oriented exchange-traded funds (ETFs) also witnessed healthy traction, with net inflows increasing 28%.
Nehal Meshram, Senior Analyst, Morningstar Investment Research India, said renewed investor interest in gold reflected persistent geopolitical uncertainties, concerns over global growth and uncertainty surrounding the trajectory of global interest rates. Despite elevated prices, investors continue to view gold as an effective hedge against macroeconomic and market risks, she added.
Hybrid funds also remained in favour, with net inflows rising more than 20%, led by arbitrage funds, multi-asset allocation funds and balanced/aggressive hybrid schemes.
“The higher inflows into arbitrage and multi-asset allocation schemes underscore sustained investor preference for diversified, lower-volatility strategies amid evolving market conditions,” said Umesh Sharma, CIO-Debt, The Wealth Company Mutual Fund.
Debt mutual funds, however, witnessed net outflows of Rs 1.09 lakh crore during the month. Sharma attributed the outflows largely to quarter-end institutional redemptions from ultra-short-duration funds to meet seasonal liquidity requirements. He added that categories such as short-duration and corporate bond funds also saw redemptions despite expectations that they would benefit from the RBI Monetary Policy Committee’s recent measures.
Looking ahead, Borthakur advised investors to remain disciplined, adhere to asset allocation and stay invested rather than attempting to time short-term market movements.
After seeing net outflows for the first time in a one-year period in May due to profit booking and shift of investor interest due to attractive fixed income yields, gold ETFs saw renewed investor interest in June with inflows in excess of Rs 3,400 crore. Silver ETFs also reversed the four-month trend of outflows with strong net inflows of over Rs 4,200 crore.
Disclaimer: This article is for informational purposes only and should not be construed as investment advice. Mutual fund investments are subject to market risks. Please read all scheme-related documents carefully before investing.
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