Inflows into Indian equity mutual funds slowed in October as investors grew more cautious toward riskier parts of the stock market, curbing exposure to funds that invest in smaller companies.
Equity funds attracted a net ₹33,000 crore (~$3.5 billion), down 14% from ₹38,310 crore in September, according to data from the Association of Mutual Funds in India, or AMFI.
Mutual funds in India pool money from individual investors and invest it across stocks and other assets. Their flows have become an important force in India’s equity market, providing a steady source of domestic buying that has helped offset persistent selling by foreign investors.
The slowdown came as a selloff pushed the NSE Nifty 50 Index to its lowest since April 2025 early in the month, while rising energy prices due to the war in the Middle East added to inflation concerns. Foreign investors were also pulling money from Indian shares in favour of markets offering greater exposure to AI.
The pullback was sharpest in smaller stocks. Small-cap funds attracted 64.1 billion rupees in October, down from a record 90.4 billion rupees in September, while mid-cap inflows fell to 48.9 billion rupees from 78.3 billion rupees.