Investors have poured over Rs 1 lakh crore into mutual funds in January, the best start to a year since 2015, according to data from the Association of Mutual Funds in India (AMFI).
The latest inflow has been mainly driven by contributions from liquid or money market funds, and equity, equity-linked saving schemes.
The inflows also helped push the asset under management of the country's 42-player mutual fund industry to a historic high of Rs 22.41 lakh crore at the end of January from Rs 21.26 lakh crore at December-end 2017.
The robust flows, however, were just ahead of the rout in the equity markets, which eroded Rs 9 trillion worth of investor wealth.
India's benchmark BSE Sensex fell more than 100 points on Wednesday, marking a seventh consecutive session of falls after earlier declining as much as 1.7 percent.
While analysts attribute the government's new capital gains tax announcement as the prime reason for the meltdown, a lot has to do with a global market rout that whacked investor sentiment.
Industry observers said it would be interesting to see whether retail investors continued with their equity investments despite the ongoing global turmoil.
Emerging markets, as a whole, saw net inflows of $30 billion in January, a seven-month high, according to data from the Institute of International Finance (IIF) released last week.