Equity-oriented mutual funds saw their average assets under management jump 17.38% year-on-year to ₹33.54 lakh crore in March 2026, up from ₹28.57 lakh crore a year ago, even as markets remained volatile. At the centre of this surge, Flexi Cap Funds emerged as the clear leader, with AUM climbing 25.10% to ₹5.28 lakh crore, making them the largest category with a 15.75% share of total equity assets—a signal that investors are actively moving away from rigid allocations toward more dynamic, opportunity-driven strategies.
Flexi Cap Funds Take the Lead
Data analysed by Abakkus Mutual Fund based on AMFI data, shows Flexi Cap Funds emerged as the largest and fastest-growing category within equity-oriented schemes, with average net AUM rising sharply to ₹5.28 lakh crore in March 2026, compared to ₹4.22 lakh crore a year back, registering a 25.10% year-on-year growth.
The category now commands a 15.75% share of total equity AAUM, up from 14.77% a year ago, making it the single largest contributor to the equity mutual fund universe.
This strong expansion highlights a clear investor preference for dynamic equity allocation strategy which offers fund managers the flexibility to navigate across market capitalizations, sectors and styles in an evolving macro-economic environment.
Beyond Flexi Cap Fund, the equity mutual fund landscape witnessed broad-based growth across most categories, with Mid Cap Funds, Sectoral/Thematic Funds, and Large Cap Funds continuing to hold significant shares in overall AAUM.
Sectoral/Thematic Funds remained among the largest categories with an average net AUM of Rs 15.01 lakh crore, though their share moderated slightly to 14.93% from 15.52% in March 2025, indicating some cooling in concentrated thematic allocations.
Mid Cap Funds saw their average net AUM rise to ₹4.38 lakh crore, reflecting a strong 22.74% growth, with their share increasing to 13.05%, reinforcing continued investor appetite for high-growth opportunities.
Large Cap Funds, while still sizable at ₹3.87 lakh crore, saw their relative share decline to 11.55% from 12.21%, pointing to a gradual shift away from traditional defensive allocations.
Small Cap Funds also recorded healthy growth, with average net AUM reaching ₹3.47 lakh crore, up 20.33% year-on-year, and accounting for 10.35% of total equity AUM.
Large & Mid Cap Funds grew to ₹3.14 lakh crore, registering a 23.39% increase, maintaining a steady presence with a 9.37% share.
Selective Moderation in Traditional and Niche Categories
Some categories witnessed relatively slower growth or declining share, reflecting evolving investor priorities:
ELSS (Equity Linked Savings Scheme ) saw marginal growth of 1.99%, with average net AUM at ₹2.30 lakh crore, and their share declining to 6.85%.
Value/Contra Funds stood at ₹2.04 lakh crore, growing 14.20%, with a stable share of 6.08%, indicating consistent but measured investor interest.
Multi Cap Funds recorded an average net AUM of ₹2.10 lakh crore, up 24.14%, taking their contribution to overall net AAUM of equity schemes to 6.27%, slightly higher than the last year, suggest investors preference for the mandated allocation structures.
Focused Funds reached ₹1.64 lakh crore, growing 16.99%, with a 4.88% share, reflecting selective investor participation.
Dividend Yield Funds remained the smallest category with an average net AUM of ₹30,604 crore, contributing less than 1% (0.91%) to total equity AAUM.
“A key highlight in March 2026 has been the strong and sustained growth of Flexi Cap Funds, which continue to attract flows given their ability to dynamically allocate across market capitalizations and across sectors. These Funds offer agility, which is much needed in today’s dynamic market conditions, a flexibility has resonated well with investors navigating today’s evolving macro environment.
At the same time, sustained flows into Mid and Small Cap funds indicate a strong appetite for alpha generation opportunities, In contrast, the relative modest growth in Large Cap Funds and ELSS categories highlights clear shift in investor priorities towards more flexible, performance oriented – investment strategies,” said Vaibhav Chugh, CEO, Abakkus Mutual Fund.
The shift is clear:
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From large-cap heavy portfolios → to diversified allocations -
From static strategies → to dynamic, flexible investing -
From short-term caution → to long-term wealth creation mindset
Flexi Cap, mid-cap, and thematic funds are increasingly becoming the core of modern portfolios, not just satellite bets.