62% of Equity Funds Cut Cash, Deploy ₹15,000 Crore into Stocks in June

Equity mutual funds invested more in stocks in June 2025, reducing their cash holdings by nearly ₹15,000 crore compared to May, data from Prime MF Database shows. The average cash-to-assets ratio fell to a 12-month low of 3.09%, down from 3.56% in the previous month.

Confidence in the Market Improves

About 62% of active equity funds lowered cash levels, a slight rise from 60% in May, indicating growing trust in market conditions. Overall, mutual funds held ₹1.5 lakh crore in cash at the end of June, compared to ₹1.65 lakh crore a month earlier.

Biggest Changes by Fund Houses

• Motilal Oswal Mutual Fund made the biggest move, reducing cash by over ₹6,500 crore and cutting its cash ratio by half.
• PPFAS and Axis MF also cut cash holdings by ₹1,500 crore and ₹2,300 crore, respectively.
• Among larger players, Kotak Mahindra, Franklin Templeton, Sundaram, and HDFC MF trimmed cash, while ICICI Prudential MF added ₹1,786 crore.

Cautious Outliers

Some funds raised cash instead of investing:

• SBI MF increased cash by ₹1,092 crore.
• PGIM India MF nearly doubled its cash pile to ₹1,110 crore, lifting its cash ratio to 5%.
• Quantum MF continued holding the highest cash ratio of 12.51%, saying they found fewer good investment opportunities.

Read More: 5 AMCs Register Over ₹15,000 Crore AUM Surge in June; SBI Mutual Fund Records Highest Inflow!

Where Did the Money Go?

In June, mutual funds added 695 new stocks, showing wider participation:

• 558 stocks were in the small-cap segment, drawing ₹21,730 crore.
• Mid-caps received ₹35,116 crore, mainly in growth-focused companies like Vishal Mega Mart, Max Healthcare, and Dixon Technologies.
• Large-caps accounted for only 8% of new additions but attracted the biggest chunk—₹40,775 crore, showing a preference for stable names.

Conclusion

The sharp reduction in cash holdings and increased investments, especially in large and mid-cap stocks, point to rising optimism among mutual fund managers. While some funds remain cautious, most are deploying more capital into equities, reflecting confidence in India’s growth story.

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