Record-Breaking ₹42,702 Crore Inflows Power India’s Mutual Funds in July

The Association of Mutual Funds in India (AMFI) is a non-profit industry body comprising all mutual fund asset management companies (AMCs) registered with the Securities and Exchange Board of India (SEBI). Established on August 22, 1995, AMFI was incorporated under Section 25 of the Companies Act, 1956, which corresponds to Section 8 of the Companies Act, 2013.

AMFI’s mission is to promote the growth of the Indian mutual fund industry in a professional, ethical, and transparent manner, while upholding high standards for the benefit of investors and stakeholders.

Its core functions include:

• Addressing issues and challenges faced by the mutual fund industry to ensure a smooth business environment for its members and unitholders.
• Acting as a liaison and advocacy body with key regulatory and policy-making institutions such as SEBI, the Reserve Bank of India (RBI), and the Government of India.

The data presented here is sourced from AMFI’s July Monthly Note, 2025.

Equity funds saw their record high monthly inflows of ₹42,702 crore in July. However, uncertainties in the global economy and trade weighed on the markets, leading to a 0.6% month-on-month decline in equity AUM to ₹33.28 lakh crore from ₹33.47 lakh crore.

In the equity mutual fund schemes:

• Sectoral/thematic funds were the clear outlier, with inflows surging 1,880% month-on-month to ₹9,426 crore, of which ₹7,404 crore came from seven new fund offers (NFOs) launched during the month.
• Small-cap funds saw a sharp rise of 61% over June, while focused funds jumped 66%, indicating strong investor appetite for concentrated bets.
• Mid-cap logged robust growth of 38%.
• Large & mid-cap saw a 44% growth, hitting record monthly inflows.
• Even though ELSS funds continued to see net outflows for the fourth straight month, the pace of withdrawals slowed by ~34% compared to June.

Debt Funds

The AUM of open-ended debt funds rose 6.7% month-on-month in July to a record ₹18.76 lakh crore, up from ₹17.58 lakh crore in June. The increase was driven by positive inflows and mark-to-market (MTM) gains. The debt-oriented schemes also saw a total inflow of ₹1,06,801 crore this month.

Hybrid Funds

In July, hybrid fund assets inched up 1.1% month-on-month to ₹10.03 lakh crore from ₹9.92 lakh crore, supported by inflows of ₹20,879 crore.

Insights:

• Multi-asset allocation funds nearly doubled their inflows, rising 93% month-on-month to ₹6,197 crore.
• Equity savings funds also saw a sharp surge of 96%, while conservative hybrid funds more than doubled with 123% growth.
• Balanced/aggressive hybrid funds posted robust inflows of ₹2,364 crore, up 77% from June, showing increased investor preference for balanced risk strategies.
• In contrast, arbitrage funds experienced a steep 53% drop in inflows, falling from ₹15,585 crore in June to ₹7,296 crore in July, likely due to narrower arbitrage spreads.

Passive Funds

Assets under passive funds fell 1.1% month-on-month to ₹12.48 lakh crore in July, weighed down by equity market losses amid global uncertainty, a stronger US dollar, and weak domestic earnings. Despite this decline, the category saw net inflows of ₹8,259 crore, marking the 57th straight month of positive flows into ETFs.

Insights

• Other ETFs saw a massive surge in inflows, jumping 430% month-on-month to ₹4,477 crore, reflecting renewed investor interest in diversified exchange-traded products.
• Index funds more than doubled inflows (123% growth), indicating continued demand for low-cost, market-replication strategies.
• Gold ETFs experienced a sharp 40% drop in inflows, likely due to profit booking and reduced safe-haven buying as gold prices softened.
• Funds of funds investing overseas posted the highest percentage jump (579%) from a small base, possibly signaling opportunistic allocations to global markets after recent corrections.

Mutual Fund Industry Sees Strong Growth

The mutual fund industry’s assets rose 1.3% in July to ₹75.36 lakh crore from ₹74.41 lakh crore in June. Equity funds accounted for 24% of the flows, registering a record monthly inflow of ₹42,702 crore.

Overall, the mutual fund industry witnessed total net inflows of ₹1,78,794 crore in July 2025.

Institutional flows into debt schemes and continued retail interest in equity categories provided a balanced growth profile. While certain segments like ELSS and gold ETFs faced pressure, the momentum across most categories points to resilient demand and a healthy outlook for the months ahead.

https://www.amfiindia.com/aboutamfi#:~:text=Association%20of%20Mutual%20Funds%20in%20India%20(AMFI)%20is%20a%20non,India%2C%20Government%20of%20India%20etc

https://www.amfiindia.com/Themes/Theme1/downloads/AMFIMonthlyNote_July2025.pdf

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