Equity fund inflows increased by 9.40% in December, while mutual fund assets surpassed Rs 50 lakh crore - The India Saga

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Equity fund inflows increased by 9.40% in December, while mutual fund assets surpassed Rs 50 lakh crore

The assets under management (AUM) of the mutual fund industry surpassed Rs 50 lakh crore for the first time in…

Equity fund inflows increased by 9.40% in December, while mutual fund assets surpassed Rs 50 lakh crore

The assets under management (AUM) of the mutual fund industry surpassed Rs 50 lakh crore for the first time in December 2023, indicating the increasing inclination of investors towards mutual funds, particularly equity-oriented schemes.

Data from the Association of Mutual Funds in India (AMFI) showed that the industry’s net asset value (AUM) increased from Rs 49.05 lakh crore in November 2023 to Rs 50.77 lakh crore in December 2023. The AUM of the mutual fund sector increased by about Rs 11 lakh crore in 2023. In December 2023, the total amount received via the systematic investment plan (SIP) route hit a record high of Rs 17,610.16 crore. In December 2023, 40,32,643 new SIPs were registered, while 20,80,622 SIPs matured or were discontinued.

According to Venkat Chalasani, CEO of AMFI, “the mutual fund industry took nearly 50 years to build the first Rs 10 lakh crore of AUM, but the last Rs 10 lakh crore, from Rs 40 lakh crore to Rs 50 lakh crore, was amassed in just over a year.” As of December 2023, retail AUM (equity plus hybrid + solution-oriented schemes) was Rs 28,87,504 crore.

Net inflows into equity-oriented mutual fund schemes persisted in December. In December 2023, net inflows into the segment were Rs 16,997 crore, up from Rs 15,536.42 crore the previous month.

Sectoral or theme funds received the largest inflows among equity schemes, totaling Rs 6,005.49 crore as compared to Rs 1,964.67 crore in November 2023.

In December, inflows into small-cap funds were recorded at Rs 3,857.5 crore, down from Rs 3,699.24 crore in November. There were outflows of Rs 280.94 crore and inflows of Rs 306.7 crore from large-cap funds.

Compared to November, when net inflows into large and mid-cap funds were Rs 1,847.45 crore, in December there was Rs 2,338.86 crore. From Rs 2,665.73 crore to Rs 1,393.05 crore, inflows into mid-cap funds decreased. December saw inflows of Rs 1,851.87 crore into multi-cap funds and Rs 1,087.45 crore into flexi-cap funds. Compared to outflows of Rs 4,706.75 crore last month, debt mutual funds saw inflows of Rs 75,559.93 crore.

The significant net outflow observed in December may have resulted from corporations having to fulfil the advance tax requirement in light of the approaching quarter end. As anticipated, the month’s largest net outflows were from liquid funds, according to Himanshu Srivastava, Associate Director, Manager of Research at Morningstar Investment Research India Pvt Ltd.

Compared to November’s outflows of Rs 644.73 crore, the net outflows from the liquid funds were Rs 39,675.27 crore. Outflows totaling Rs 6,029.75 crore and Rs 9,432 crore from ultra short-term and low-term funds, respectively. Compared to inflows of Rs 13,538.05 crore in the previous month, net inflows into hybrid schemes were Rs 15,009.3 crore this time.

Compared to November’s outflows of Rs 644.73 crore, the net outflows from the liquid funds were Rs 39,675.27 crore. Outflows totaling Rs 6,029.75 crore and Rs 9,432 crore from ultra short-term and low-term funds, respectively. Compared to inflows of Rs 13,538.05 crore in the previous month, net inflows into hybrid schemes were Rs 15,009.3 crore this time.

In contrast to 16,18,14,583 for November 2023, mutual fund folios reached an all-time high of 16,48,90,272 in December 2023.

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