AMFI July 2026 data: Small-cap fund inflows jump 39% as equity flows moderate; debt sees major turnaround
Equity mutual fund inflows moderated in July, but investors continued to favour small- and mid-cap funds, while debt funds staged a sharp reversal. SIP contributions remained above ₹31,000 crore, highlighting continued retail participation.
The biggest swing came from debt funds, which attracted ₹1.88 lakh crore in July, after witnessing an outflow of ₹1.09 lakh crore in June. Equity funds received ₹24,697 crore, lower than ₹28,973 crore in June, according to data released by the Association of Mutual Funds in India (AMFI).
Small-cap funds emerge as July’s equity favourite
Small-cap funds led growth in the equity segment in July, with inflows rising to ₹7,768 crore from ₹5,602 crore in June, a jump of nearly 39%. Mid-cap inflows also increased marginally to ₹6,192 crore from ₹6,090 crore.
Nitin Agrawal, CEO, Mutual Funds, InCred Money, said, “Growth in small-cap inflows signals that investors are actively leaning into segments where value has emerged after a period of correction.”
However, flexi-cap fund inflows moderated to ₹4,709 crore in July from ₹5,231 crore in June 2026, while large-cap funds saw outflows of ₹1,322 crore in July, compared with inflows of ₹2,067 crore in June.
Agrawal highlighted flexi-cap’s structural strength, noting that it crossed ₹6 lakh crore in AUM, making it the largest among actively managed categories. He said its appeal lies in the flexibility to navigate across market-cap segments when investors are uncertain about which segment will lead.
Shashwat Singh, Fundamental Analyst, Bajaj Broking, said the equity flow moderation was marginal. He also pointed to sectoral and thematic fund inflows declining to ₹1,328 crore from ₹1,469 crore.
Vikas Gupta, CEO & Strategist, OmniScience Capital, remained cautious. “The focus on mid- and small-cap equities remains with retail investors. Comparatively, large-cap and flexi-cap are behind in terms of inflows.” He said this could indicate retail investors are chasing earnings and stock-price momentum.
Gupta warned that small- and mid-cap indices have significantly high PEs, suggesting the underlying stocks could be overvalued. “The day earnings slow down will be the beginning of significant falls in stock prices,” he said, urging investors to consider this risk at current valuations.
Debt funds see major turnaround
Debt funds recorded the sharpest reversal, moving from a ₹1.09 lakh crore outflow in June to a ₹1.88 lakh crore inflow in July.
Agrawal said the reversal was largely mechanical and should not be over-interpreted. “Most of the Treasury activities that led to outflows in June 2026 generally get reversed in July 2026,” he said.
Hybrid and gold inflows moderate
Hybrid funds attracted ₹11,491 crore, down from ₹12,893 crore in June. Arbitrage funds saw inflows rise to ₹6,502 crore from ₹5,799 crore. Agrawal said arbitrage posted its “strongest month in the current recovery cycle”.
Multi-asset allocation fund inflows moderated to ₹3,753 crore in July from ₹4,811 crore, but Agrawal said the category remains structurally robust.
Gold ETFs attracted ₹1,559 crore, lower than ₹3,443 crore in June. Agrawal noted that gold ETFs have recorded positive inflows for two consecutive months after May’s profit-booking.
However, Gupta said, “Gold has lost its sheen,” while multi-asset funds continue to see subdued but healthy inflows.
SIPs stay resilient
Singh said that retail investment persistence remained highly resilient, with SIP contributions reaching ₹31,961 crore in July, up marginally from ₹31,781 crore in June.
“This marked the fifth consecutive month in which SIP inflows remained above or close to the ₹31,000-crore threshold,” he adds.
Mutual fund industry stages sharp recovery
Singh said the overall mutual fund industry bounced back sharply in July, recording a net inflow of ₹2.36 lakh crore, compared with a net outflow of ₹52,949 crore in June.
He said the recovery was primarily driven by fixed-income reallocation, with debt funds recording ₹1.88 lakh crore in inflows, of which 96% came from liquid, overnight and money-market funds.
According to Aditya Agarwal, Co-Founder, Wealthy.in, the July picture shows resilient yet more selective demand. “SIP-driven buying keeps equity flows firmly positive, yet the combination of rising redemptions and a rotation out of large-caps and into small-caps points to investors chasing momentum while trimming exposure at the safer, index-heavy end of the market,” Agarwal noted.
Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
About the Author
Sheetal Goel is a Content Producer at Livemint, where she covers corporate developments, personal finance, business trends, markets, and SEBI-related updates. She focuses on simplifying complex financial concepts and presenting them in a clear, reader-friendly manner, thereby helping audiences better understand investment trends, personal finance, and market developments. Her writing focuses on making finance more accessible to everyday readers while maintaining clarity, accuracy, and relevance.
She holds a degree in Economics (Hons.) along with an MBA in Finance, which has helped her develop a strong foundation in financial analysis, market understanding, and business reporting. Before joining journalism, she worked with finance and broking firms, where she closely followed market developments, investment strategies, and evolving industry trends. This practical exposure strengthened her understanding of financial markets. She has also written content across multiple formats and platforms, including YouTube, LinkedIn, and Instagram.
Over time, she has developed expertise in covering market-linked stories, investor-focused topics, and regulatory updates in a simplified yet informative style. She also enjoys reading and listening to Hindi poetry, reflecting her appreciation for literature and creative expression beyond the world of markets and numbers.
