Inflows into equity mutual funds plunge sharply in November; MFs trim holdings in ICICI Bank, HCL Tech, Kotak Mahindra Bank

• Inflows into equity mutual fund schemes tanked 76% in November to ₹2,258 crore as against ₹9,390 crore in October.
• Meanwhile, debt schemes of mutual funds witnessed inflows of ₹3,668 crore during the month against outflows of ₹2,817 crore in the previous month.
• In November, SIP inflows were at an all-time high at ₹13,306 crore. This compared with ₹13,040 crore inflows in October.
• Meanwhile, net assets under management (AUM) of the mutual fund industry stood at ₹40.37 lakh crore as on November 31, 2022.

Inflows into equity mutual funds plunged by 76% in the month of November as markets continued to be volatile on global uncertainty surrounding the pace of rate hikes by central banks across the US and Europe.

Flows into equity mutual fund schemes tanked in November to ₹2,258 crore as against ₹9,390 crore in October, according to AMFI, the regulatory body for the mutual funds sector.

Meanwhile, debt schemes of mutual funds, which are considered relatively safer, witnessed inflows of ₹3,668 crore during the month against outflows of ₹2,817 crore in the previous month.

“Market continues to react to global headwinds. Rate hikes will continue to impact global markets but not for long, irrespective of that, (the) mutual fund industry has performed well. There have been outflows from the retail schemes as people are encashing profits,” said NS Venkatesh, chief executive at AMFI in a statement. He cited the festive season as the reason for people taking out profits.

The net assets under management (AUM) of the mutual fund industry stood at ₹40.37 lakh crore as on November 31, 2022.

On the bright side, SIP (systematic investment plan) inflows in November were at an all-time high at ₹13,306 crore. In October, the inflows were ₹13,040 crore.

In November, mutual funds deployed ₹1,700 crore into the market while foreign institutional investors (FIIs) bought ₹34,900 crore in the Indian secondary market, said a report by Nuvama Institutional Equities (previously known as Edelweiss Institutional Equities).

Key stocks that mutual funds bought in the month of November include HDFC Bank and Axis Bank. Meanwhile, mutual funds trimmed their holdings in ICICI Bank, HCL Technologies and Kotak Mahindra Bank, as per Nuvama.

Key additions by MFs	Key deductions by MFs
HDFC Bank	ICICI Bank
Axis Bank	HCL Technologies
Archean Chemicals	Kotak Mahindra Bank

(Source:Nuvama Institutional Equities)

While the market remains volatile, the primary market has been recovering since November –with the month witnessing the highest number of IPO launches for 2022 at nine.

Among the nine IPOs, mutual funds’ largest investment was in specialty chemical company Archean Chemical Industries that listed at a 10% premium to its issue price of ₹407.

Key additions in Midcap by MFs	Key reductions in Midcap by MFs	Key additions in Smallcap by MFs	Key reductions in Smallcap by MFs
Delhivery	BHEL	Archean Chemical	Praj Industries
Max Financial	Ramco Cements	Fusion Micro Finance	GE Shipping Co
Bikaji Foods International	Gujarat Gas	Kaynes Technology	UTI AMC
PB Fintech	PVR		Fino Payments

(Source:Nuvama Institutional Equities)

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