By-Karthick Jonagadla, smallcase manager and Founder at Quantace
“April’s AMFI sheet confirms a barbell market: equity inflows eased to ₹24,269 crore, the first dip in four months, yet the streak of positive flows hit fifty months and the SIP book had hit a record high of Rs 26,632 crore, preserving endogenous liquidity that underpins our 25,300 Nifty-50 two-month target. Small-cap and thematic schemes still attracted about ₹4,000 crore and ₹2,000 crore respectively, signalling that retail money is willing to reach for beta despite choppy breadth—an attitude aided by India’s structural growth narrative.
The SIP conveyor belt remains the market’s behavioural anchor: monthly contributions have marched to a record ₹26,600-plus crore, now funding roughly one-fifth of industry assets and cushioning drawdowns in high-octane segments. On the other end of the spectrum, debt and liquid funds swung from March’s tax-driven exodus to massive inflows as corporates redeployed surplus cash and locked into falling local yields; April also saw a record ₹98,700 crore of rupee bond issuance, highlighting abundant short-tenor liquidity.
Option-chain anatomy shows peak put interest at 23,900//24,000 and a secondary bulwark at 23,500; heavy call writing caps upside until 24,500, carving out a tight tactical corridor that traders can map with layered spread. Finally, the ongoing India’s response to Pakistan sponsored terrorism injects a geopolitical risk premium; past confrontations typically shave 10 percent off next-month inflows, so watch Brent $70 and USD/INR 87 as stress beacons.
We suggest investors should ride SIP-fuelled quality small-caps on dips, park dry powder in ultra-short debt, and respect the 23,900/23,500 tripwires en route to 25,300.”