Equity mutual funds continued to attract healthy investor participation in August 2025, though momentum eased compared to the sharp inflows seen in July.
Folio Trends
Mid-cap and small-cap funds remained the favorite segments, together adding more than 8 lakh new folios, signaling that retail investors continue to chase higher-growth opportunities. Sectoral and thematic funds also drew strong traction, reflecting rising interest in specialized investment themes.
Net Inflows
Net inflows were robust across categories:
- Mid-cap funds: ₹5,331 crore
- Small-cap funds: ₹4,993 crore
- Sectoral/thematic funds: ₹3,893 crore
- Large-cap funds: ₹2,835 crore
While flows remained positive across the board, mid- and small-caps led the pack, commanding the largest share of fresh money.
Broader Picture
On the overall equity side, AUM held steady at ₹33.08 lakh crore, even as monthly inflows moderated from ₹42,702 crore in July to ₹33,430 crore in August. This cooling reflects emerging caution among investors after a sharp run-up in markets, yet it also underlines that the appetite for equities remains strong.
Investor Takeaway
The message for investors is clear: disciplined allocations to mid- and small-caps have been rewarding, but rising valuations now demand selectivity and measured entry. Sectoral/thematic funds may offer tactical opportunities, but broader equity inflows suggest confidence in long-term wealth creation remains intact.
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