India's equity mutual fund inflows rebound in November on strong earnings, low inflation

[MUMBAI] Equity mutual fund inflows into the Indian stock market rebounded after three months in November, as improved corporate earnings, stable economic growth and benign inflation powered blue-chips to record highs after 14 months.

Inflows rose 21 per cent month-on-month to 299.11 billion rupees (S$4.28 billion) in November, data from the Association of Mutual Funds in India showed on Thursday (Dec 11). Contributions through systematic investment plans (SIPs) hovered around the record high levels hit in October, at 294.45 billion rupees.

Equity mutual funds have seen uninterrupted monthly inflows since February 2021, powered by SIPs, government reforms and supportive central bank policy. That steady domestic money has helped shrug off relentless foreign selling and turbo-charged the post-Covid market rally.

“The sustained support coming from SIP contributions from retail investors at nearly 300 billion rupees every month is the pillar of support for markets and is certainly a contributor to the rally to record highs,” said Venkat Chalasani, chief executive of AMFI.

SIP contributions have risen 26 per cent year-on-year during January to November to 3.04 trillion rupees, cushioning foreign outflows of US$18 billion in 2025 and helping the market rebound.

Large-cap, mid-cap and small-cap funds recorded a 69 per cent, 18 per cent and 27 per cent rise in inflows to 16.4 billion rupees, 44.87 billion rupees and 44.07 billion rupees, respectively, in November.

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Inflows into multi-cap funds remained little changed at 24.63 billion rupees.

The sizeable inflows across categories show investors sought exposure in multiple pockets in markets as they recover after 14 months, said Himanshu Srivastava, principal researcher at Morningstar Investment Research India.

The Nifty 50 and mid-cap index rose about 2 per cent each and hit record highs in November, while small-caps fell 3 per cent, despite the mutual fund inflows. REUTERS