Mutual Funds See Strong March Growth, Driven by Equity, ETFs, and Systematic Investment Plans

Mutual Fund Industry Sees Strong Inflows Amid Market Volatility

The Indian mutual fund industry witnessed a sharp rise in equity mutual fund inflows in March, despite a decline in domestic markets due to global uncertainty. The industry's net asset under management (AUM) for the month stood at Rs 73.73 lakh crore, down from Rs 82.02 lakh crore in February 2026.

Despite the decline in AUM, the average AUM (AAUM) remained strong at Rs 79.46 lakh crore, indicating sustained investor participation. This trend reflects the growing confidence of domestic investors in the Indian capital markets.

Key Highlights from March's Numbers

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The industry also marked its 61st consecutive month of positive equity inflows since March 2021. The strong inflows were driven by a 55.7 percent jump in net inflows into equity schemes, which stood at Rs 40,450.26 crore in March, the highest monthly inflow since July 2025.

Systematic Investment Plans (SIPs) Remain Resilient

SIP flows rebounded to Rs 32,087 crore in March, up 7.5 percent from Rs 29,845 crore in February. The number of contributing SIP accounts rose to 9.72 crore from 9.44 crore, reflecting steady expansion in the investor base. However, churn remained elevated during the month, with around 52.8 lakh new SIPs registered, while about 53.4 lakh were discontinued or matured.

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Passive Funds See Strong Traction

Passive strategies had a strong month, with other ETFs attracting Rs 19,802 crore and index funds seeing inflows of Rs 8,169 crore. This was partly driven by institutional rebalancing and growing acceptance of passive strategies among investors.

Gold ETFs Moderate

Gold ETF inflows continued to cool in March, with net investments falling sharply to Rs 2,265.7 crore from Rs 5,254.9 crore in February, a decline of nearly 57 percent. Despite positive flows, assets under management slipped to Rs 1.71 lakh crore from Rs 1.79 lakh crore.

Yearly Trends Remain Strong

The Indian mutual fund industry marked a clear turning point in FY26, as investor behaviour shifted from momentum-driven bets to disciplined asset allocation. The year saw categories like Flexi Cap funds attract over Rs 89,000 crore and Multi Asset Allocation funds double to Rs 65,000 crore.