Mumbai, April 2026: India’s domestic mutual fund industry closed FY26 on a positive note, with assets under management (AUM) rising 12.2% year-on-year to ₹73.73 lakh crore, adding nearly ₹8 lakh crore despite market volatility, according to data released by the Association of Mutual Funds in India.
Equity Inflows Rebound Strongly in March
March data highlighted a sharp recovery in investor sentiment toward equities:
- Equity mutual fund inflows surged to ₹40,450.26 crore
- Up from ₹25,977.81 crore in February
- Highest inflows recorded since July 2025
This rebound came despite ongoing geopolitical tensions, indicating sustained investor confidence in equity markets.
SIP Contributions Hit All-Time High
Systematic Investment Plans (SIPs) continued to drive retail participation:
- Record SIP inflows of ₹32,087 crore in March
- Compared to ₹29,845 crore in February
The rise underscores strong retail investor confidence, even amid market fluctuations.
Overall Industry Sees Net Outflows
Despite strong equity inflows, the overall mutual fund industry reported:
- Net outflows of ₹2.39 lakh crore in March
- Against ₹94,530 crore inflows in February
The decline was largely due to:
- Debt mutual fund outflows of ₹2.94 lakh crore
- Reduced inflows into Gold ETFs, which fell to ₹2,266 crore from ₹5,254.95 crore
Flexi-Cap, Mid-Cap & Small-Cap Funds Lead Inflows
Among equity categories:
- Flexi-cap funds: ₹10,054.12 crore inflows
- Small-cap funds: ₹6,263.56 crore
- Mid-cap funds: ₹6,063.53 crore
- Large-cap funds: ₹2,997.84 crore
This trend reflects investors’ preference for diversified and high-growth segments.
Growth Slows Compared to Previous Years
While FY26 saw healthy expansion, growth moderated compared to:
- FY25: ~23% AUM growth
- FY24: ~36% growth
The slowdown is attributed to multiple macroeconomic factors.
Key Factors Impacting Markets
Market volatility during the year was driven by:
- Elevated valuations and subdued corporate earnings
- Persistent FII selling
- Global geopolitical tensions and trade uncertainties
- Lack of strong AI-driven investment momentum
More recently, tensions linked to the US–Iran–Israel conflict pushed crude oil prices higher, raising concerns over India’s fiscal outlook.
Outlook
Despite short-term volatility and outflows in certain segments, the mutual fund industry continues to show resilience, supported by strong SIP inflows and sustained retail participation.
