Mutual Funds: BFSI, FMCG, Healthcare lead buying in April 2026

Mutual fund managers preferred BFSI, FMCG, and Healthcare in April 2026, while Auto and Utilities saw net selling. Equity AUM grew 11.9% to Rs 33.9 trillion, and net equity inflows saw a marginal rise despite a slight dip in SIP flows.

Sectoral Trends and AUM Growth

Indicative flows in April 2026 show that the Banking, Financial Services and Insurance (BFSI), Fast-Moving Consumer Goods (FMCG), and Healthcare sectors saw the highest mutual fund buying. According to a report by Ambit Institutional Equities, these sectors led the preference for fund managers during the month, even as Auto, Utilities, and Consumer Durables witnessed net selling after adjusting for sector performance.

The report noted that for the current calendar year to date, all sectors witnessed inflows. This trend was primarily led by BFSI, Telecom, and New-age Tech. The overall equity assets under management (AUM) expanded by 11.9 per cent in April 2026 to reach Rs 33.9 trillion. During the same period, cash levels held by funds also saw an increase of 7.1 per cent, totaling Rs 1.98 trillion.

Cash Levels and Fund Allocation

"Cash as % of Total AUM (ex-passive) in Apr'26 was at 5.5% (- 23bps MoM); Cash in Flexi/Large/Mid/Small-cap stands at 8.5%/4.4%/4.5%/6.9% (-92/-7/-48/-22bps MoM)," the report stated.

SIP and Net Equity Inflows

Regarding contribution trends, the report revealed a slight dip in Systematic Investment Plan (SIP) flows, which decreased to Rs 311 billion. However, net equity inflows saw a marginal rise, reaching Rs 434 billion compared to Rs 432 billion in March 2026. The report also pointed out that net SIP account creation remained marginally negative during this window.

Scheme-wise Inflow Leadership

"Flexi-cap schemes continued to lead net inflows (Rs 101bn), followed by Small-cap schemes (Rs 69bn) & Mid-cap schemes (Rs 66bn)," the report observed.

Long-Term Shift Towards Equity

The report further highlighted a significant long-term shift in the composition of domestic mutual funds. Over the last six years, the AUM of equity funds rose from 36 per cent in April 2020 to 52 per cent in April 2026.

Since April 2020, total domestic mutual fund AUM grew at a compound annual growth rate (CAGR) of approximately 25 per cent. This growth was driven by a 33 per cent CAGR in equity funds, while debt AUM grew at 12 per cent. "Since Apr-20, AUM of debt mutual funds as a proportion of total AUM almost halved, from 55% to 28% currently, while equity AUM as a % of total rose from ~36% to ~52%," the report highlighted.

Growth in Individual Investor Participation

Ownership of domestic mutual funds by individuals also saw a substantial increase over the last decade, rising from approximately 44 per cent in March 2014 to 60 per cent as of April 2026. Geographically, the distribution of ownership remained steady, as the top 30 cities continued to constitute the bulk of the domestic mutual fund AUM. (ANI)

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