Inflows touch 11-month high of Rs 10,730 crores in Feb

New Delhi: Inflows into equity mutual funds surged to Rs 10,730 crore in February, the highest level in 11 months, even as the broader market witnessed heavy volatility amid concerns over the impact of coronavirus.

Overall, mutual fund industry witnessed a net outflow of Rs 1,985 crore across all segments, mainly owing to withdrawal from liquid or money market category. This comes following an inflow of Rs 1.2 lakh crore in January.

According to data released by Association of Mutual Funds in India on Wednesday, net inflows into equity and equity-linked schemes rose from Rs 7,547 crore in January to Rs 10,730 crore in February.

This is the highest investment since March 2019, when equity schemes attracted an inflow to the tune of Rs 11,756 crore. As the spread of coronavirus epidemic scared global equities, Indian stock market too found itself in its grip and registered a fall of almost 6.5 per cent (for S&P BSE 100) in February 2020.

"However, showing maturity, Indian investors viewed this fall as an opportunity to buy into equities and invested in equity funds," said Himanshu Srivastava, Senior Analyst - Manager Research at Morningstar India.

The inflow is well spread between the category of funds such as large-cap, mid-cap, small-cap and multi-cap, among others. Multi-cap, large-cap, mid-cap and small-cap funds saw inflows of Rs 1,625 crore, Rs 1,607 crore, Rs 1,451 crore and Rs 1,498 crore, respectively.

Investors continued to focus on multi-cap category as it provides them exposure in all the three segments of the equity markets (large, mid and small caps).

The aim is to benefit from the opportunities arising in all three market segments by staying invested in one fund, Srivastava added.