Nevertheless, it is noteworthy that this period still represents the 50th consecutive month of positive inflows into equity mutual funds in India.

All equity fund categories, except for Equity Linked Savings Schemes (ELSS), reported net inflows, with ELSS facing seasonal outflows following the tax-planning period.

This decline marks the fourth consecutive month of decreasing inflows, driven largely by investor concerns over potential U.S. tariffs and geopolitical tensions.

Liquid funds attracted the highest net inflows of Rs 1,18,656 crore, while overnight and money market funds also saw positive inflows, indicating a renewed interest in short-term instruments.

In April 2025, Exchange Traded Funds (ETFs) saw significant growth, with the 'Other ETFs' category attracting net inflows of Rs 19,056 crore, a notable increase from Rs 10,961 crore in March, as investors sought cost-efficient options amid market uncertainties.

Despite this surge in ETF inflows, overall equity mutual fund inflows in India reached a 12-month low of Rs 24,269 crore, reflecting a decline of 3.24% from March's Rs 25,082 crore.

Flexi-cap funds emerged as the most favored category, indicating a strong preference for diversified exposure across various market capitalizations.

In the fixed income sector, debt-oriented mutual funds rebounded with net inflows of Rs 2,19,136 crore in April, reversing the significant outflows seen in previous months.

In terms of specific fund categories, midcap fund inflows decreased by 3% to Rs 33.14 billion, while smallcap fund inflows fell by 2.2% to Rs 40 billion, according to AMFI data.

Conversely, large-cap funds experienced a positive trend, with inflows increasing by 7.75% to Rs 26.71 billion in April.

Medium and medium-to-long duration funds showed signs of stabilization, buoyed by optimism regarding potential rate cuts, although gilt funds continued to experience marginal outflows.

Overall, the total assets under management (AUM) for equity-oriented schemes rose from Rs 29.45 lakh crore in March to Rs 30.57 lakh crore in April, driven by capital appreciation and ongoing inflows.