Systematic Investment Plans See Record Participation, Equity Mutual Fund Inflows Rise 56% in March Amid Market Volatility

Record SIP Flows and Healthy Demand for Equity Mutual Funds in March

The Association of Mutual Funds in India (AMFI) released monthly data on April 10, revealing a record high in Systematic Investment Plan (SIP) flows in March. The data shows that SIP inflows reached a staggering ₹32,087 crore, the highest ever recorded, underscoring the growing preference for disciplined, long-term equity investing among Indian households.

This significant increase in SIP flows comes despite heightened volatility driven by geopolitical developments. Domestic investors have remained steadfast, continuing to invest with conviction, despite the challenges. The structural shift towards systematic investing is a positive sign for the long-term stability and depth of India's capital markets. Navneet Munot, MD and CEO of HDFC AMC, noted that this shift augurs well for the long-term stability and depth of India's capital markets.

Equity mutual funds also witnessed healthy demand in March, with net flows jumping 56% on a month-on-month basis to ₹40,450 crore from ₹25,977 crore in February. On a year-on-year basis, the inflows rose almost 61% from ₹25,082 crore recorded in March 2025.

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Among the equity schemes, flexi-cap funds attracted the highest inflows at ₹10,054 crore, marking the second consecutive month of over ₹10,000 crore inflows in the scheme. Small-cap funds attracted the second-highest inflows of ₹6,263 crore, followed by mid-cap funds, which saw investments worth ₹6,063 crore.

In contrast, ELSS (tax-saving) and dividend funds witnessed outflows of ₹437 crore and ₹59.21 crore, respectively in March. Value/Contra funds saw the lowest positive inflows at ₹2,155 crore.

Nitin Agrawal, CEO, Mutual Funds, InCred Money, noted that while flows had moderated in the preceding months, March 2026 numbers provide the required confidence that positive fund flow activity can sustain even in periods of high uncertainty and volatility, a clear reflection of investor maturity. He also observed that optimism around equities is back with a more diversified and deliberate approach to investing.

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Passive investment products continued to see decent traction during the month, with other exchange-traded funds (ETFs) emerging as the largest contributor among passive categories, attracting net inflows of ₹19,802 crore. Index fund inflow stood at ₹8,168 crore. Meanwhile, gold ETF recorded net inflows of ₹2,265 crore in March, sharply lower than ₹5,254 crore last month, marking a decline of about 56.9%.

The decline in flows came as relative valuations turned more favourable for equities compared with gold. Meanwhile, Fund of Funds (FoFs) received inflows of ₹530 crore.

Debt funds, however, saw a sharp reversal in investor sentiment in March, with the category reporting outflows of nearly ₹2.94 lakh crore, compared to inflows of ₹42,106 crore in the previous month. In the debt fund category, liquid funds accounted for the biggest share of outflows, with the category seeing outflows of around ₹1.35 lakh crore. Overnight funds also witnessed outflows of around ₹40,228 crore during the month.

Juzer Gabajiwala, Director at Ventura, noted that debt funds have had a very muted year with collections dropping nearly 84% from last year as taxation has played a very pivotal role in the investor's mind while looking at these funds.