MARCH 2026 MF FLOWS – MACRO PICTURE
MARCH 2026 MF FLOWS – MACRO PICTURE In March 2026, mutual funds saw overall net outflows of ₹(2,39,910) crore, led by year-end treasury management for tax outflows. While active debt funds saw outflows of ₹(2,94,987) crore, active…
MARCH 2026 MF FLOWS – MACRO PICTURE
In March 2026, mutual funds saw overall net outflows of ₹(2,39,910) crore, led by year-end treasury management for tax outflows. While active debt funds saw outflows of ₹(2,94,987) crore, active equity funds saw net inflows of ₹40,450 crore. However, hybrid funds saw net outflows of ₹(16,282) crore, led by Arbitrage fund redemptions. Passive funds saw net inflows of a robust ₹30,768 crore, even as gold ETF inflows remained subdued.
As of end March 2026, the total AUM of mutual funds fell sharply to ₹73.73 crore from ₹82.03 trillion in February; a fall of -10.1%. This can be attributed to a 10.5% fall in the market, which took a heavy toll on the AUM. NFO flows in March stood at ₹3,743 Crore, largely led by flows into equity funds and passive funds. Gross SIP flows in March 2026 stood at ₹32,087 crore, a historic high, although it did include spill over from February.
YEAR-END REDEMPTIONS TAKES ITS TOLL ON FLOWS
Here is a look at monthly flows across fund categories in last 13 months.
| Month | Debt Fund Flows (₹ Crore) | Equity Fund Flows (₹ Crore) | Hybrid Fund Flows (₹ Crore) | Passive Fund Flows (₹ Crore) | Total MF Flows(₹ Crore) |
|---|---|---|---|---|---|
| Mar-25 | (2,02,663) | 25,082 | (705) | 14,149 | (1,64,435) |
| Apr-25 | 2,19,136 | 24,269 | 14,248 | 20,229 | 2,76,827 |
| May-25 | (15,909) | 19,013 | 20,942 | 5,526 | 29,108 |
| Jun-25 | (1,711) | 23,587 | 23,429 | 3,997 | 49,095 |
| Jul-25 | 1,06,801 | 42,702 | 21,162 | 8,259 | 1,78,794 |
| Aug-25 | (7,980) | 33,430 | 15,614 | 11,437 | 52,443 |
| Sep-25 | (1,01,977) | 30,422 | 9,683 | 19,057 | (43,146) |
| Oct-25 | 1,59,958 | 24,690 | 14,417 | 16,668 | 2,15,657 |
| Nov-25 | (25,693) | 29,911 | 13,619 | 15,385 | 32,755 |
| Dec-25 | (1,32,410) | 28,054 | 11,101 | 26,723 | (66,591) |
| Jan-26 | 74,827 | 24,029 | 17,698 | 39,955 | 1,56,459 |
| Feb-26 | 42,106 | 25,978 | 12,230 | 13,879 | 94,530 |
| Mar-26 | (2,94,987) | 40,450 | (16,282) | 30,768 | (2,39,910) |
Data Source: AMFI (negative figures in brackets)
March 2026 saw positive net inflows across equity funds and passive funds. Equity funds saw second-best inflows in March 2026, only the second time it has crossed ₹40,000 crore in FY26. Within equity funds; flexi cap funds, mid-cap funds and small cap funds led the flows, a clear indication of risk-on investing. In the passive segment, flows were led by index ETFs and index funds, even as flows into gold ETFs tapered sharply in March 2026.
On the debt fund flows, the selling was pronounced in funds at the short end of the curve; including liquid funds, overnight funds, money market funds, and low duration funds. That is more due to managing liquidity for year-end advance tax payouts. The hybrid funds segment also saw net selling in March, led entirely by sharp outflows from arbitrage funds. Arbitrage funds are classified as hybrid funds, but are short term debt funds in substance.
ACTIVE DEBT FUNDS: INTENSE SELLING AT THE SHORT END
The month of March 2026 saw net active debt fund outflows of ₹(2,94,987) Crore, due to the year-end pressure on redemptions for advance tax. Liquid funds dominated debt fund outflows at ₹1,34,988 crore; followed by Overnight Funds ₹40,228 crore, Money Market Funds at ₹29,207 crore, Low Duration Funds ₹25,227 crore, and Short Duration Funds ₹22,193 crore. Among funds at the longer end, corporate bond funds saw net selling of ₹15,293 crore and Gilt Funds ₹3,078. Not a single debt fund category saw net inflows.
ACTIVE EQUITY FUNDS: ALPHA HUNTING AND ALLOCATION
The month of March 2026 saw robust inflows into equity funds. The inflows were led by Flexi-Cap Funds ₹10,054 Crore, Small Cap Funds ₹6,264 Crore, Mid-Cap Funds ₹6,064 Crore, and Large & Mid Cap Funds ₹5,307 Crore. Only dividend yield funds and ELSS funds saw marginal outflows. Total equity fund flows at ₹40,450 crore is only the second time in FY26 that the figure has crossed the ₹40,000 crore mark. The preference appears to be towards allocation as indicated by flexi-cap funds and large & mid-cap funds; and alpha hunting as indicated by mid-cap funds and small cap funds.
HYBRID FLOWS NEGATIVE; PASSIVE FLOWS ROBUST
Let us look at the hybrid fund flows first. Hybrid fund net outflows stood at ₹(16,282) Crore in March 2026 (including solution funds). Net inflows were dominated by Multi Asset Allocation Funds (MAAF) at ₹5,213 Crore. That was largely offset by outflows of ₹(21,114) crore from arbitrage fund, which are nothing but a proxy for short-end debt funds.
In the passive category; inflows were dominated by Index ETFs at ₹19,802 Crore and Index Funds at ₹8,169 crore. Inflows into Gold Funds were relatively tepid at ₹2,266 crore. Clearly, the appetite for precious metals has come down drastically with the fall in prices of gold and silver from the peaks of January 2026.
The broad theme for March 2026 was all about short-term debt fund and arbitrage fund outflows to take care of advance tax payouts by corporates. In equity funds, the focus was on alpha hunting and allocation, while it was just good old allocation in hybrid funds. In Passive Funds, the action is reverting back to traditional equity and debt index ETFs and index funds; while gold ETFs are taking a back seat!
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