By Bharath Rajeswaran
(Reuters) – Inflows into India’s equity mutual funds rose about 15% month-on-month in December, with investors continuing their buying spree unaffected by the prospect of fewer U.S. rate cuts in 2025 and worries of likely moderation in earnings.
Inflows into equity mutual funds rose to 411.56 billion rupees ($4.8 billion) last month compared to 359.43 billion rupees in November 2024.
December saw the second highest monthly inflows ever, extending the streak of inflows to the 46th month – the longest streak on record, data released by the Association of Mutual Funds in India (AMFI) on Thursday showed.
India’s benchmark NSE Nifty 50 and BSE Sensex fell about 2% in December 2024, while the broader smallcaps and midcaps rose 0.6% and 1.4%, respectively.
Money coming into smallcap and midcap equity mutual funds rose 4.3% and 13.5% respectively, while inflows into largecap funds fell 21%.
This is the highest and the second-highest monthly inflows on record into midcap and smallcap equity mutual funds, respectively.
“Higher returns in the broader small- and mid-caps have continued to aid investor interest in these segments. But earnings delivery in the December quarter will be crucial for the interest to sustain,” said Sanjeev Hota, vice president and head of research at Mirae Asset Sharekhan.
Inflows into sectoral and thematic funds doubled month-on-month to 153.32 billion rupees in December 2024, helped by the launch of 12 new such funds during the month. These funds saw greater interest compared with other categories of equity mutual funds for the 12th straight month.
Contributions to systematic investment plans, where investors make regular payments into mutual funds, rose to 264.59 billion rupees, hitting a record high for the 17th time in 18 months.
($1 = 85.8850 Indian rupees)
(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Sumana Nandy)
