Parag Parikh Flexicap Fund Tops Monthly Mutual Fund Inflows

Equity Inflows Surge in March Amid Market Volatility

The Indian equity market witnessed a significant surge in inflows in March, with overall equity inflows jumping to Rs 40,450 crore. This marks a substantial increase from the previous month, with a notable preference for flexi-cap funds. Flexi-cap funds, in particular, saw the highest inflows, pulling in Rs 10,054 crore in March, up from Rs 6,924 crore in February and Rs 7,672 crore in January.

Multicap funds also saw a steady pickup, with inflows rising to Rs 2,981 crore from Rs 1,933 crore in February. Compared to other equity categories, such as mid and small-cap funds, both flexi-cap and multicap segments appear to be benefiting from a preference for balanced exposure rather than sharp, segment-specific bets.

Flexicap Funds Lead the Pack

Read also: WhiteOak Capital AMC Abolishes Exit Loads Across 16 Schemes

Flexicap funds alone accounted for nearly a quarter of the total equity inflows in March, with Parag Parikh Flexi Cap Fund leading the pack. The fund pulled in Rs 3,950 crore during the month, a wide margin ahead of its competitors. HDFC Flexi Cap Fund came in a strong second, while ICICI Prudential Flexi Cap Fund trailed significantly.

Cash Holdings Reveal Fund Managers' Strategy

A closer look at cash holdings reveals the varying strategies employed by fund managers. Parag Parikh Flexi Cap Fund has maintained relatively high cash levels, sitting on 17.5 percent cash in March. This cautious approach is consistent with the fund's history, with a gradual decline from over 23 percent last year.

Read also: Mutual Fund Portfolios: Balancing Diversification and Excess

In contrast, HDFC Flexi Cap Fund has been actively deploying cash, with cash levels dropping sharply to 4.5 percent in March. ICICI Prudential Flexi Cap Fund, on the other hand, has been fully invested, with cash at just 3.7 percent in March.

Multicap Funds Show a Different Story

Multicap funds saw a noticeable pickup in inflows in March, with Rs 2,981 crore flowing into the category. Kotak Multicap Fund emerged as the top gainer, attracting Rs 911 crore in March. The top three multicap funds by inflows are:

Cash Positions in Multicap Funds

Multicap funds, in general, have been running with very low cash levels, indicating a largely invested stance. Kotak Multicap Fund had around 2.2 percent cash in March, while Nippon India Multi Cap Fund had just 1.1 percent cash. HDFC Multi Cap Fund also held minimal cash at around 1.5 percent.

The Takeaway

The surge in equity inflows in March highlights the investor preference for balanced exposure and flexibility in their portfolios. Flexi-cap funds, in particular, have seen significant inflows, with varied strategies employed by fund managers. Multicap funds, on the other hand, have been running with very low cash levels, indicating a largely invested stance. The message is clear – stay invested and don't time the market.