HDFC AMC Shares Extend Losses as Mutual Fund Inflows Decline in February

Mumbai: Shares of HDFC Asset Management Company Ltd (HDFC AMC) continued their downward trend on Thursday, declining up to 3% as February’s mutual fund inflows showed a significant drop. Data released by the Association of Mutual Funds in India (AMFI) on March 12 revealed that equity mutual fund inflows slumped by 26% compared to the previous month, raising concerns among investors.

Mutual Fund Inflows Take a Hit Amid Market Volatility

The latest AMFI report showed that equity mutual fund inflows fell sharply to ₹29,303.34 crore in February, down from ₹39,200 crore in January. The fall in inflows comes amid rising market uncertainty, global economic concerns, and increased volatility in the Indian stock markets.

Adding to the pressure, systematic investment plan (SIP) inflows hit a three-month low of ₹25,999 crore, a decline from ₹26,400 crore in January and ₹26,459 crore in December. The moderation in inflows has been attributed to profit-booking by investors and cautious sentiment due to recent market fluctuations.

HDFC AMC and UTI AMC Stocks Under Pressure

As a result of these developments, shares of HDFC AMC dropped 2.86% to an intraday low of ₹3,660 per share on Thursday. The stock has been witnessing a declining trend for the last two trading sessions, reflecting investor concerns over the fall in inflows.

Similarly, UTI Asset Management Company also experienced selling pressure, with its stock price declining 0.39% to ₹938.70 per share on the National Stock Exchange (NSE) as of 10:40 AM.

Despite the dip, analysts believe the overall sentiment in the mutual fund industry remains stable, given that the market has sustained positive inflows for 48 consecutive months.

Expert Views on the Mutual Fund Market Outlook

Pankaj Shrestha, Head of Investment Services at PL Capital, commented on the trend, stating:
“Despite this dip, the market has sustained positive inflows for 48 consecutive months, reflecting continued investor confidence. Notably, large-cap funds saw a slight decline but held up relatively better than other categories, indicating investors’ preference for stability amid market volatility.”

This suggests that while short-term fluctuations have impacted inflows, long-term confidence in mutual fund investments remains intact.

SIP Assets Under Management Decline Due to Market Corrections

The AMFI data further indicated that total assets under management (AUM) through SIPs moderated to ₹12.38 lakh crore in February, down from ₹13.20 lakh crore in January. The decline was primarily due to a mark-to-market (MTM) hit, meaning that the existing value of investments reduced due to the fall in stock prices.

SIP investments have been a key driver of retail participation in the mutual fund industry, and while the dip in inflows is notable, experts suggest that this could be a temporary setback influenced by short-term market trends.

Market Outlook for HDFC AMC and Mutual Fund Industry

Despite the recent decline, analysts remain optimistic about the long-term outlook for the mutual fund sector, driven by strong domestic investor participation, increased awareness, and systematic investing habits.

For HDFC AMC, the stock’s future performance will likely depend on market sentiment, inflow trends in the coming months, and broader economic factors. The asset management sector as a whole will be closely watched for signs of recovery in inflows and investor sentiment in the next financial quarter.