August 2026 Mutual Fund Flows: Small-Cap and Mid-Cap Inflows Surge as Large-Caps Extend Outflows

Equity mutual fund inflows rose to ₹29,329 crore in August 2026, up 19% from July, driven by record small-cap inflows of ₹7,973 crore and strong mid-cap flows of ₹6,989 crore. Large-cap funds recorded a second straight month of outflows, while six equity NFOs added a modest ₹768 crore. This piece breaks down what the AMFI data actually shows, why rising flows into small and mid caps don’t by themselves signal attractive valuations, and how investors should check their own portfolio concentration before adding to the trend.
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