Monthly Analysis
Reading May 2026 correctly: The headline net outflow of −₹64,021 Cr is primarily a debt/liquid seasonal phenomenon. May typically sees institutional treasury withdrawals as Q1 FY27 advance tax provisions begin. Liquid + Liquid+ alone accounts for −₹81,316 Cr. The structural health signals remain intact: equity net inflow +₹30,804 Cr marks the 63rd consecutive positive month (HDFC confirmed −46% MOM, +13% YoY vs ₹27,156 Cr May 2025) and SIP at ₹30,954 Cr is the third straight month above ₹30,000 Cr. The key anomaly to watch: ETFs posted a net outflow of −₹1,345 Cr — the first in 17 months — as both Gold ETF (−₹725 Cr) and Other ETFs (−₹620 Cr) reversed. This is worth monitoring but not alarming given it follows an exceptionally strong April and March for ETFs.
- Equity57.8%
- ETFs14.0%
- Liquid8.6%
- Liquid+7.6%
- Short Dur5.5%
- Arbitrage3.4%
- Debt Other2.5%
- FOF0.6%
Industry AUM at ₹81.58L Cr is down a marginal −0.4% from April’s ₹81.92L Cr. The small decline reflects two offsetting forces: (1) Debt/liquid net outflows of −₹81K+ Cr reduced AUM mechanically, while (2) Equity MTM gains partially offset this — the Nifty gained ~2% in May, contributing to Equity AUM rising from ₹46.73L to ₹47.16L Cr (+0.9%) despite lower net inflows than April. The ₹82L Cr AUM milestone established in February continues to hold. At ~$859 billion (₹95.01/$ on May 31), the Indian MF industry is firmly tracking toward the $1 trillion mark.
| Category / Sub-Category | AUM Apr ’26 |
AUM May ’26 |
1M Chg% |
Net Flow Apr ’26 |
Net Flow May ’26 |
|||
|---|---|---|---|---|---|---|---|---|
| ▐ EQUITY (Open + Hybrid + Solution + Index + ELSS CE) | ||||||||
| Flexi Cap Fund | 5,59,366 | 5,63,896 | +0.8% | +10,148 | +5,176 | |||
| Sectoral/Thematic | 5,30,230 | 5,35,187 | +0.9% | +1,949 | +648 | |||
| Mid Cap Fund | 4,75,012 | 4,87,794 | +2.7% | +6,551 | +4,385 | |||
| Large Cap Fund | 3,98,835 | 3,97,061 | −0.4% | +2,525 | +1,593 | |||
| Index Funds (Equity-Oriented) | 2,30,711 | 2,33,461 | +1.2% | +10,222 | +2,796 | |||
| Large & Mid Cap Fund | 3,35,218 | 3,39,999 | +1.4% | +4,490 | +3,278 | |||
| Small Cap Fund | 3,92,772 | 4,04,380 | +3.0% | +6,886 | +4,946 | |||
| Multi Asset Allocation | 1,87,071 | 1,90,326 | +1.7% | +5,113 | +3,929 | |||
| Balanced Adv / DAA | 3,18,622 | 3,16,586 | −0.6% | +1,773 | +181 | |||
| Aggressive Hybrid Fund | 2,51,394 | 2,51,288 | −0.0% | +1,489 | +655 | |||
| Value / Contra Fund | 2,11,480 | 2,10,504 | −0.5% | +1,478 | +510 | |||
| Multi Cap Fund | 2,28,691 | 2,32,887 | +1.8% | +3,806 | +2,291 | |||
| Focused Fund | 1,73,513 | 1,74,258 | +0.4% | +1,195 | +830 | |||
| ELSS (Open-Ended) | 2,37,715 | 2,36,446 | −0.5% | −568 | −651 | |||
| Equity Savings Fund | 49,114 | 49,194 | +0.2% | −82 | +75 | |||
| Dividend Yield Fund | 31,519 | 31,306 | −0.7% | −21 | −97 | |||
| Retirement Fund | 31,775 | 31,769 | −0.0% | +82 | +68 | |||
| Children’s Fund | 25,841 | 26,048 | +0.8% | +225 | +203 | |||
| ELSS (Close-Ended) | 3,918 | 3,880 | −1.0% | −14 | −10 | |||
| ▶ Total Equity | 46,72,797 | 47,16,272 | +0.9% | +57,248 | +30,804 | |||
| ▐ ARBITRAGE | ||||||||
| ▶ Arbitrage Fund | 2,70,562 | 2,78,956 | +3.1% | +12,378 | +5,698 | |||
| ▐ LIQUID | ||||||||
| Overnight Fund | 1,04,920 | 89,940 | −14.3% | +31,420 | −15,525 | |||
| Liquid Fund | 6,35,971 | 6,09,457 | −4.2% | +1,65,105 | −29,681 | |||
| ▶ Total Liquid | 7,40,891 | 6,99,397 | −5.6% | +1,96,525 | −45,206 | |||
| ▐ LIQUID+ (Maturity <1 Year) | ||||||||
| Money Market Fund | 3,34,924 | 3,10,807 | −7.2% | +20,643 | −24,692 | |||
| Low Duration Fund | 1,38,398 | 1,29,193 | −6.7% | +7,093 | −9,400 | |||
| Ultra Short Duration | 1,29,712 | 1,28,380 | −1.0% | +15,652 | −1,617 | |||
| Floater Fund | 51,680 | 51,364 | −0.6% | +19 | −401 | |||
| ▶ Total Liquid+ | 6,54,714 | 6,19,744 | −5.3% | +43,407 | −36,110 | |||
| ▐ SHORT DURATION (Maturity 1–3 Years) | ||||||||
| Corporate Bond Fund | 1,85,779 | 1,81,139 | −2.5% | +6,197 | −7,010 | |||
| Short Duration Fund | 1,15,456 | 1,11,750 | −3.2% | +3,917 | −3,887 | |||
| Banking & PSU Fund | 77,015 | 76,382 | −0.8% | −694 | −760 | |||
| Dynamic Bond Fund | 31,962 | 31,391 | −1.8% | −705 | −654 | |||
| Medium Duration Fund | 25,319 | 25,139 | −0.7% | −392 | −263 | |||
| Credit Risk Fund | 21,095 | 21,210 | +0.5% | +1,318 | +49 | |||
| ▶ Total Short Duration | 4,56,626 | 4,47,011 | −2.1% | +9,641 | −12,525 | |||
| ▐ DEBT OTHER (Long Duration, Gilt, Conservative Hybrid, Close-Ended Debt) | ||||||||
| Conservative Hybrid Fund | 29,224 | 29,294 | +0.2% | −106 | +22 | |||
| Gilt Fund | 33,001 | 31,436 | −4.7% | −1,048 | −1,684 | |||
| Long Duration Fund | 13,669 | 12,807 | −6.3% | −727 | −897 | |||
| Fixed Term Plan (CE) | 11,100 | 9,861 | −11.2% | −4,441 | −1,129 | |||
| Gilt Fund (10yr constant) | 4,404 | 4,135 | −6.1% | −149 | −299 | |||
| Med to Long Duration | 10,709 | 10,506 | −1.9% | −158 | −229 | |||
| Infrastructure Debt (CE) | 925 | 938 | +1.4% | — | — | — | ||
| Other Debt / Interval | 4,935 | 4,934 | −0.0% | −26 | −34 | Stable | ||
| Debt-Oriented Index Funds | 1,00,346 | 98,933 | −1.4% | −5,597 | −1,853 | |||
| ▶ Total Debt Other | 2,08,313 | 2,02,845 | −2.6% | −12,252 | −6,102 | |||
| ▐ ETFs / PASSIVE | ||||||||
| Other ETFs | 9,64,929 | 9,60,115 | −0.5% | +10,755 | −620 | |||
| Gold ETF | 1,78,110 | 1,84,571 | +3.6% | +3,040 | −725 | |||
| ▶ Total ETFs | 11,43,039 | 11,44,686 | +0.1% | +13,795 | −1,345 | |||
| ▐ FUND OF FUNDS — OVERSEAS | ||||||||
| ▶ FOF Overseas | 45,445 | 49,430 | +8.8% | +1,661 | +764 | |||
| GRAND TOTAL | 81,92,388 | 81,58,342 | −0.4% | +3,22,403 | −64,021 | |||
Three forces shaped May’s net outflow of −₹64,021 Cr:
1. Post-FY-start liquid reversal (Liquid −₹45,206 Cr + Liquid+ −₹36,110 Cr = −₹81,316 Cr combined): April brought a massive FY-start surge as corporates re-deployed year-end cash into liquid and money market funds. May is the predictable reversal — Q1 advance tax provisions, vendor payments, and routine treasury cycle reduce the parked cash. This is seasonal mechanics, not investor distress.
2. Short Duration reversal to outflow (−₹12,525 Cr from +₹9,641 Cr): April’s corporate bond and short duration tailwind from the RBI easing cycle appears to be fading. Corporate Bond Fund swung from +₹6,197 Cr to −₹7,010 Cr. With the rate cut cycle likely near its terminal, duration positioning appetite is reduced. Credit Risk Fund held marginally positive (+₹49 Cr), confirming credit risk appetite hasn’t collapsed.
3. ETF outflow — notable but context-dependent (−₹1,345 Cr): For the first time in 17 months, ETFs recorded a net outflow. Both Gold ETF (−₹725 Cr) and Other ETFs (−₹620 Cr) saw redemptions. Gold ETF reversal follows near-record gold prices and likely represents profit-booking. Other ETF outflow follows back-to-back exceptional months (+₹22K Cr March, +₹14K Cr April). One negative month does not break a structural story — monitor June carefully.
May 2026 SIP: ₹30,954 Cr (AMFI bulletin confirmed) — Third consecutive month above ₹30,000 Cr. Down −0.5% MOM vs April’s ₹31,115 Cr. Below March’s ATH of ₹32,087 Cr. Daily SIP run-rate of ~₹999 Cr/day (May has 31 days). The resilience of SIP above ₹30K Cr for three straight months confirms that systematic investing has structurally reset to a higher base — not a one-off.
The ₹30K Cr SIP floor is structural, not cyclical. December 2025 was the first month SIP crossed ₹31,000 Cr. Since then, every month except February (₹29,845 Cr — impacted by a shorter month) has been above ₹30,000 Cr. May’s ₹30,954 Cr, despite MOM moderation, represents a 25%+ jump compared to the ₹24,000-25,000 Cr range of just 18 months ago. The SIP acceleration narrative is intact.
Annualised SIP run-rate: ~₹3.71 trillion. At ₹30,954 Cr/month, the FY27 annualised SIP run-rate stands at ~₹3.71L Cr — well above FY26’s full-year total of ₹3.35L Cr. FY27 is on track to be the biggest SIP year in Indian MF history if the pace holds. The key variable is whether March 2026’s ATH of ₹32,087 Cr is re-tested in H2 FY27 as the festive season and year-end bonus deployments kick in.
Note: SIP AUM for May 2026 stood at ₹17.12 lakh crore, accounting for 36.3% of Equity AUM (per HDFC AMFI May 2026 report). This is up from ₹16.85L Cr in April and ₹16.64L Cr in February — reflecting consistent SIP AUM accretion each month.
Post-ATH normalisation is the May equity theme — not deterioration. April’s ₹57,248 Cr was boosted by a FY-start surge in Index Funds (equity-oriented +₹10,222 Cr) and exceptional performance across categories. May’s ₹30,804 Cr reflects normalisation, not structural weakening. All categories except ELSS and Dividend Yield remain in positive territory. HDFC confirms equity net at ₹30,804 Cr — a 46% decline YoY growing +13% vs ₹27,156 Cr in May 2025.
Flexi Cap moderated to ₹5,176 Cr (from ₹10,148 Cr) but remains the #1 category. The moderation follows an unusually strong April. The category has now received 11 consecutive months as the top net-inflow destination. Structural SIP allocations into Flexi Cap are holding. Multi Asset Allocation at ₹3,929 Cr is the second-strongest, reflecting growing preference for one-stop dynamic allocation solutions.
BAF/DAA moderated sharply to +₹181 Cr (from +₹1,773 Cr). After two consecutive months of acceleration, BAF flows hit a speed bump. This category is highly sensitive to market outlook — with Nifty near record levels in May, some investors likely paused BAF SIPs in favour of direct equity categories. Value/Contra Fund at ₹510 Cr also moderated, consistent with high-valuation environment reducing mean-reversion appeal.
ELSS net outflow deepened to −₹661 Cr (open-ended −₹651 + close-ended −₹10 Cr, combined −₹661 per HDFC). The ELSS redemption trend reflects FY-end tax-optimisation redemptions from 3-year lock-in completions. This is structural as newer tax regimes reduce fresh ELSS appeal. Equity AUM grew to ₹47.16L Cr (+0.9% MOM) on Nifty MTM gains despite moderated inflows.
May’s debt narrative is entirely seasonal — with one exception.
1. Liquid reversal is textbook (−₹45,206 Cr after +₹1,96,525 Cr in April): This is the mechanics of the FY-start cycle unwinding. April’s surge was corporate re-deployment. May sees partial withdrawal as companies start deploying that cash into operations, capex payments, and advance tax provisions. The liquid fund AUM is still healthy at ₹6.99L Cr — well above December 2025’s ₹5.82L Cr, confirming the structural base is higher.
2. Short Duration reversal to −₹12,525 Cr is the key watch signal: Corporate Bond Fund’s swing from +₹6,197 Cr to −₹7,010 Cr in one month is notable. This likely reflects: (a) rate cut expectations getting priced in with fewer forward cuts expected; and (b) institutional portfolio rebalancing after locking in gains from April’s spread compression. Credit Risk Fund barely positive (+₹49 Cr) — credit risk appetite remains cautious.
3. Debt Other (Debt@) at −₹6,102 Cr (total incl. debt-oriented index) is improving from −₹12,252 Cr April. The HDFC Debt@ bucket includes debt-oriented index funds (−₹1,853 Cr in May) along with conventional debt. FTP maturities at −₹1,129 Cr were fewer vs April’s −₹4,441 Cr. Gilt Fund outflows deepened (−₹1,684 Cr), reflecting investor reluctance toward duration risk. Conservative Hybrid turned marginally positive (+₹22 Cr). Debt-oriented index funds saw −₹1,853 Cr outflows, consistent with target maturity funds approaching maturity deadlines.
Notable Development: May 2026 marks the first net outflow for the ETF bucket after 17 consecutive months of positive net inflows. Both Gold ETF (−₹725 Cr) and Other ETFs (−₹620 Cr) recorded net outflows simultaneously. Importantly, ETF AUM was barely changed (+0.1% MOM to ₹11.45L Cr), suggesting this was profit-booking/redemption rather than structural exit. Total Passive Fund AUM (Equity Index + ETF + Debt Index, Ex-FOF) stood at ₹15.27 lakh crore — 18.7% of industry AUM. Passive fund folios have grown by 142 lakh (+33%) since May 2025.
ETF interpretation — one data point does not break a structural story: The 17-month streak broken by −₹1,345 Cr needs context. The ETF bucket had exceptional months in February (+₹9.7K Cr), March (+₹22K Cr) and April (+₹13.8K Cr). Gold ETF profit-booking is entirely rational — spot gold near $3,300/oz globally and ₹9,500+/gm domestically creates compelling profit-locking opportunities. Other ETF outflow reflects institutional rebalancing after an overweight index position built during March’s correction. The structural ETF story — +37% folio growth YoY, retail ownership of index funds rising — is not disrupted by one month of outflows. Watch June: a return to positive would confirm the streak was merely a pause, not a reversal.
| Fund Name | Mobilised (₹ Cr) |
|---|---|
| Motilal Oswal Contra Fund | 267 |
| Axis Nifty Capital Markets Index Fund | 69 |
| Invesco India Nifty Bank Index Fund | 30 |
| SBI CRISIL-IBX 10:90 Gilt+SDL Dec 2029 | 27 |
| Invesco India BSE Sensex Index Fund | 17 |
| SBI Nifty G-sec Jul 2031 Index Fund | 16 |
| Edelweiss Nifty Next 50 ETF | 7 |
| SBI Nifty200 Value 30 ETF | 9 |
| SBI Nifty Smallcap 250 ETF | 6 |
| Groww Nifty Private Bank Index Fund | 6 |
| Groww Nifty Private Bank ETF | 6 |
| 360 ONE MSCI India ETF | 6 |
| DSP Nifty FMCG ETF | 5 |
| Grand Total (13 Open-Ended) | 471 |
NFO read: May’s 13 NFOs raising ₹471 Cr is light but structured. 12 of 13 are passive/index schemes — 8 equity index/ETF and 2 debt index. The only active fund was Motilal Oswal Contra Fund (₹267 Cr — 57% of total NFO mobilisation), which stands out as investors showed appetite for a differentiated contrarian strategy in a market near record levels. SBI’s two debt index fund launches (CRISIL-IBX Gilt+SDL Dec 2029 and Nifty G-sec Jul 2031) continue the trend of target-maturity debt index products offering predictable short-to-medium duration debt exposure with index transparency — filling gaps in the passive fixed income space. FY27 NFO activity is just beginning to ramp up after April’s subdued ₹828 Cr.
▲ AUM Holds at ₹81.58L Cr — Market Resilience
Despite −₹64K Cr net outflow, industry AUM declined only −0.4% MOM. Equity MTM gains (~Nifty +2% in May) contributed ~₹47,000 Cr of MTM appreciation, almost fully offsetting the debt drain. The ₹82L Cr AUM level is behaving as a structural floor, not a ceiling. AUM has now been above ₹80L Cr for six consecutive months.
▲ 63rd Consecutive Positive Equity Month — Unbroken Since Oct 2020
Equity inflows at ₹30,804 Cr (HDFC confirmed) have been positive for 63 straight months. YoY, May 2026 grew +13% from ₹27,156 Cr in May 2025 — confirming the structural uptrend even as MOM moderation occurs. Through every market shock — COVID second wave, 2022 global rate shock, 2024 election volatility, 2025 US tariff fears — Indian MF investors have not net-redeemed equity for five full years. FYTD FY27 equity = ₹88,052 Cr in just 2 months.
▲ SIP Above ₹30K Cr for Third Straight Month
May’s ₹30,954 Cr is the 3rd consecutive month above ₹30,000 Cr (excluding Feb’s short-month dip). The annualised run-rate of ~₹3.71L Cr/year already exceeds FY26’s full-year total of ₹3.35L Cr. FY27 is tracking to be the first ₹4L Cr+ SIP year in Indian MF history. FY-start bonus deployments and fresh salary increments in April-June typically add new SIP registrations.
▼ ETF 17-Month Streak Broken — Context Matters
First ETF net outflow (−₹1,345 Cr) since January 2025. Driven by Gold ETF profit-booking near all-time gold prices and institutional rebalancing in equity ETFs after exceptional March-April inflows. ETF AUM barely moved (+0.1%). The structural ETF story — folio growth ~37% YoY, SIP allocations to index funds rising, EPFO allocations ongoing — is not disrupted. One negative month warrants monitoring, not alarm.
▲ Arbitrage Continues FY-Start Cycle (+₹5,698 Cr)
Arbitrage fund inflows of +₹5,698 Cr in May continue the FY-start institutional positioning theme. Cash-futures spread positions are being built as market stabilises post the volatile March-April period. Arbitrage AUM at ₹2.79L Cr (+3.1% MOM) is on track for further growth in June-July as spread opportunities widen into the earnings season. This is the 5th consecutive year this seasonal pattern holds.
▼ Short Duration Reversal to Outflow — Rate Cycle Signal
Short Duration reversed from +₹9,641 Cr (Apr) to −₹12,525 Cr (May). Corporate Bond Fund alone swung ₹13K Cr. With the RBI rate cut cycle likely near terminal (2 cuts delivered in FY26-27 so far), the easy money from duration positioning is being taken off the table. Investors who deployed into short-duration during the rate-cut cycle are now booking gains. Credit Risk at barely +₹49 Cr suggests risk appetite is cautious.
▲ FOF Overseas Accelerating — +₹764 Cr, +8.8% AUM MOM
FOF Overseas AUM jumped to ₹49,430 Cr (+8.8% MOM, +18.7% vs April 2025 implicitly). Net inflow of +₹764 Cr, though lower than April’s +₹1,661 Cr, reflects sustained appetite for global diversification. With US markets recovering and rupee depreciation (~₹95/$) making USD assets more attractive in INR terms, Indian investors are increasingly allocating globally through FOF vehicles. AUM near ₹50K Cr is a milestone.
▲ Folio Count Crosses 27.66 Cr — Broadening Participation
27.66 Cr scheme-level folios (28.93 Cr including FOF Domestic) as on May 31. +13L folios in a single month. The 5-year CAGR of 23% (9.54 Cr in Dec 2020 to 27.66 Cr in May 2026) is remarkable. ETF folios at 3.94 Cr are now the fastest-growing sub-segment. B30 city penetration and digital distribution (Zepto Money, Groww, Paytm Money) continue to drive first-time investor participation in smaller cities.
Source: Association of Mutual Funds in India (AMFI) · Official Monthly Report · May 2026 · All figures in ₹ Crore unless stated · Data as published by AMFI · Grand Total Folios: 27,65,67,797 · USD/INR: 95.01 (May 31, 2026)
INXITS · AMFI DATA · MAY 2026 · AMFIINDIA.COM · Strictly for Internal Use Only · Confidential
Mutual Fund investments are subject to market risks · Past performance is not indicative of future results · Please read all scheme related documents carefully before investing · This report is compiled from AMFI published data for internal informational and communication purposes only · Not for external distribution
Aditya Rajpurohit is a Mutual Fund Research Analyst at inXits with 5+ years of experience in equity and mutual fund analysis. He specialises in fund selection, portfolio construction, and long-term wealth creation strategies for retail and HNI investors.
