Credit risk funds and fixed term plans (FTPs) of mutual funds withnessed outflows during May 2019 as the recent credit default events in the NBFC sector continued to take a toll. However, equity funds witnessed a growth in inflows during the month.
According to data released by the Association of Mutual Funds in India (AMFI), credit risk funds witnessed Rs 4,155 crore worth of outflows in May. In April 2019, credit risk funds recorded outflows of Rs 1,253 crore. Fixed Maturity Plans (FMPs) witnessed a net outflow of Rs 1,797 crore in May as against Rs 17,644 crore in April, while net outflow from the balanced hybrid funds category stood at Rs 2,481 crore in the month under review, as per AMFI.
The mutual fund industry has been witnessing redemption pressures in the wake of the debt crisis at various groups, including IL&FS, Essel and DHFL. Some fund houses have also deferred payouts to investors in fixed income schemes. However, on the equity front, net inflows into growth and equity oriented funds saw a growth after the decline in April. The inflows into equity funds including equity-linked savings schemes stood at Rs 5407 crore after the 42 per cent decline in inflows at Rs 4,608 crore in April. The jump in equity fund inflows follow the sharp rise in the stock markets after the victory of the NDA in the elections. The total corpus of the equity oriented funds were Rs 724,033 crore as of May 2019.