The mutual fund industry recorded net inflows of ₹25,000 crore in the March quarter, with equity funds driving the trend.
Active equity funds drew ₹92,000 crore, while passive equity saw ₹25,000 crore in net inflows.
Together, they contributed ₹117,000 crore—signaling steady investor confidence in long-term growth assets.
“The industry’s AUM rose to ₹65.74 lakh crore in March 2025, a robust 23.11% jump from ₹53.40 lakh crore in March 2024,” said Prateek Agrawal, MD & CEO, Motilal Oswal AMC.
He attributed this growth to increasing household preference for financial assets and comfort with market-linked instruments.
Multi asset funds lead the hybrid charge
Hybrid funds attracted renewed interest, particularly Multi Asset Funds, which cornered 74% of the hybrid fund inflows.
Balanced Advantage and Aggressive Hybrid funds followed with ₹2,000 crore and ₹1,000 crore, respectively.
“Multi Asset Funds continue to gain traction due to their balanced approach across equity, debt, and commodities,” the report noted.
Conservative hybrid funds, however, saw net outflows of ₹500 crore—highlighting a dip in appetite for debt-heavy hybrid strategies.
Flexi cap, small cap funds stay hot
Among active equity categories, Flexi Cap (₹16,500 crore) and Small Cap (₹12,000 crore) funds drew the most investor interest.
Mid Cap funds also fared well with ₹11,700 crore in inflows.
In the passive space, large cap funds remained the top choice, receiving 90% of the net flows, although some money moved towards Mid Cap and Small Cap ETFs.
“Passive funds saw a 21% YoY increase in AUM to ₹11.13 lakh crore, driven by growing interest in rule-based investing,” said Pratik Oswal, Head of Passive Funds at Motilal Oswal AMC.
Broad-based equity funds dominate
Broad-based funds attracted the lion’s share of flows.
In active equity, they captured 72% of the net flows. In passive equity, their share rose to 84% from 66% in the previous quarter.
Factor-based passive funds held a 15% share, while thematic funds accounted for just 2.7%.
Thematic funds see dip, but defence, infra still attractive
Thematic mutual fund inflows dropped from ₹14,000 crore to ₹8,400 crore quarter-on-quarter. Still, investors showed interest in Infrastructure and Consumption themes (₹2,200 crore combined).
The defence theme alone pulled in ₹1,000 crore.
New themes like Electric Vehicles and Capital Markets emerged in the passive thematic space, though broader inflows remained subdued.
Debt funds bleed ₹1.1 lakh crore
Debt mutual funds witnessed outflows of ₹1.1 lakh crore, reversing the ₹38,000 crore inflow seen in the previous quarter. Institutional advance tax payments in March led to major redemptions, especially from Constant Maturity funds, which alone saw outflows of ₹1.03 lakh crore.
Liquid funds also bore the brunt, witnessing net outflows of ₹52,000 crore. Floating Rate, Gilt, and Target Maturity funds each lost between ₹2,500-2,800 crore.
Short-term debt segments like Overnight and Ultra Short Duration funds recorded net outflows of ₹30,800 crore and ₹12,400 crore, respectively.
International funds in pause mode
International mutual funds remained largely stagnant due to RBI restrictions. Net inflows across these categories were minimal, with broad-based funds pulling in just ₹100 crore. Passively managed international thematic funds saw net outflows of ₹800 crore.
New fund launches gather steam
The quarter also saw 73 new fund offers (NFOs), raising ₹13,067 crore—indicating fund houses continue to tap investor appetite for fresh themes and strategies.
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