Invest amid valuation comfort, robust earnings growth prospects

The midcap segment of the equity market continues to command investors’ attention. Midcap funds recorded inflows of 5,330 crore in August 2025 —the highest ever in asingle month, according to the Association of Mutual Funds in India (Amfi).

- SARBAJEET K SEN

“Inflows in midcap funds have been very consistent at around 8-9 percent of total equity net inflow over the past four to five years. In August, it was even higher at around 41 per cent. This clearly shows the increased conviction and maturity of investors around this category, which has strong earnings growth potential over the medium term,” says Ankit Jain, senior fund manager, Mirae Asset Investment Managers (India).

Midcap schemes invest at least 65 per cent of their corpus in companies ranked between the 101st and 25oth by market capitalisation. As of August 31, 2025, a total of 67 midcap schemes managed assets worth €4.44 trillion.

Rewarding over longterm

While high inflows during periods of uncertainty may appear counter-intuitive, it may reflect investors’ maturity and willingness to take calculated risks. “We believe uncertain times offer better opportunities toinvest and reap the benefits of future stability,” says Kirti Dalvi, equity fund manager, Mahindra Manulife Mutual Fund.

Growth potential