Equity fund inflows jump 19% in August; mid- and small-cap funds investor favourites

Small-cap funds continued to attract the most money, while mid-cap and multi-cap funds also saw higher inflows. At the same time, large-cap and ELSS funds continued to see net outflows.

Mid-cap funds saw investors putting Rs 6,989 crore into the category in the month under review, compared with Rs 6,192 crore in July. This was an increase of nearly 13%, making mid-cap funds the biggest month-on-month gainer in absolute terms among the major equity categories.

Small-cap funds continued to attract the highest amount of money among equity categories. The category saw Rs 7,973 crore investment in August, slightly higher than Rs 7,768 crore in July – a 2.7% increase. This shows that investor interest in small caps remained strong, though the growth was much slower than in mid-cap funds.

Large-cap funds again log outflows

Large-cap funds continued to see money flowing out in August. The category recorded a net outflow of Rs 1,147 crore, although this was lower than the Rs 1,322-crore outflow in July. So, while the outflow narrowed by about Rs 174 crore, large-cap funds remained in the red for the second month.

ELSS funds saw investors withdrawing a net Rs 1,078 crore in August, compared with an outflow of Rs 959 crore in July – outflow widening by around Rs 119 crore. ELSS remained one of the weaker equity categories during the month.

Flexi-cap funds attracted 7.4% more inflows at Rs 5,059 crore in August, up from Rs 4,709 crore in July. This makes flexi-cap funds among the largest equity categories in terms of monthly inflows.

Multi-cap funds also saw a good increase in investor interest. Inflows rose 15.7% to Rs 3,733 crore in August from Rs 3,227 crore in July.

Large & mid-cap fund inflows rose 13% during the month. The category saw Rs 3,873 crore inflows in August, compared with Rs 3,425 crore in July, showing stronger demand for funds that combine large- and mid-cap stocks.

But focused funds recorded one of the sharpest percentage jumps. Inflows increased 55% from Rs 642 crore in July to Rs 995 crore in August. While the absolute inflow is smaller than that of mid- and small-cap funds, the month-on-month increase was significant.

Debt funds move from inflows to outflows

Debt mutual funds saw a dramatic turnaround in August. The category moved from a net inflow of Rs 1,87,511 crore in July to a net outflow of Rs 8,127 crore in August. This is a fall of about Rs 1.96 lakh crore in net flows.

In other words, the strong inflow seen in July completely reversed in August.

Liquid funds had attracted Rs 1,19,066 crore in July and now in August, inflows dropped sharply to just Rs 19,934 crore. That is a fall of about Rs 99,132 crore, or more than 83%.

Overnight funds saw an even sharper reversal. They had attracted Rs 40,413 crore in July, but August saw a Rs 30,654-crore outflow. This is a swing of nearly Rs 71,067 crore in just one month.

Gilt funds saw a sharp rise in outflows. The category moved from an outflow of Rs 206 crore in July to Rs 1,824 crore in August. That means the outflow increased by about Rs 1,618 crore in a month.

Short-term funds also slipped into deeper outflow. They moved from a small Rs 840-crore inflow in July to a Rs 4,259-crore outflow in August.

The August data shows that the massive fall in debt fund inflows was largely driven by money-market and short-term categories. Liquid and overnight funds alone saw their combined net flows fall by about Rs 1.70 lakh crore between July and August.

Hybrid schemes

Hybrid mutual funds saw a moderate decline in net inflows in August. The category attracted Rs 10,045 crore, compared with Rs 11,491 crore in July. This is a fall of about 12.6%. The category still remained firmly in positive territory, but inflows were lower than the previous month.

Multi-asset funds remained a strong area within hybrid schemes, though inflows were slightly lower in August. The category attracted Rs 3,671 crore, compared with Rs 3,753 crore in July. This is a small decline of around 2.2%. Despite the dip, multi-asset funds continued to attract substantial money and remained one of the biggest contributors to hybrid fund inflows.

Disclaimer: The data, figures, and insights presented in this article are based on the latest monthly report released by the Association of Mutual Funds in India (AMFI) for August 2026. Mutual fund investments are subject to market risks, and past inflows, outflows, or fund performance do not guarantee future returns. The information is intended for educational and informational purposes only and should not be construed as investment advice. Investors should consult a qualified financial advisor before making any investment decisions.

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