Indian Mutual Funds Record Rs.68.5 Lakh Crore AUM in October 2024
The Indian Mutual Fund industry reached a new record in October 2024, with its assets under management (AUM) hitting Rs.68.5 lakh crore. This showed a small increase of 0.7% from the previous month and a strong growth of 43.3% compared to last year.
Since the lows post-pandemic, AUM has risen by a stunning 177.2%. So, this reflects not just full recovery but also the building of trust among investors. In the month of October, for instance, mutual funds had gathered fresh investments of Rs.2.4 lakh crore. This is quite a turnaround from September, which reported outflows of Rs.71,114 crore. That is quite an increase that has been ascribed to a 20.4% MoM contraction in redemptions besides a 4.8% MoM jump in funds mobilization. A record SIP at Rs.25,323 crore grew at 3.3% MoM. To enjoy undisturbed and focused long-term wealth creation processes with the volatility of the markets, investors went increasingly for SIPs.
SIP AUM touched Rs.13.3 lakh crore, accounting for nearly 20% of the industry’s total AUM. However, close-ended schemes witnessed a minor slide; their AUM slipped to Rs.26,767 crore. While the decline was the first in six months, their share in the total AUM remained stable at 0.4%.
Active managed funds led the way in the mutual fund industry as they had a majority share of Rs.56.7 lakh crore, or 82.7%, in the total AUM as of October. Within the overall equity AUM of Rs.38.8 lakh crore (-0.8% MoM), active equity funds accounted for Rs.30.4 lakh crore (-0.9% MoM), while passive equity funds, which include ETFs, totalled Rs.8.4 lakh crore.
Debt funds comprised 27.8% of the overall AUM, which grew to Rs.19.1 lakh crore (+3.6% MoM). Although that is an increase, still only 3% of debt funds were passively managed. Hybrid funds also rose because their AUM rose to Rs.9.2 lakh crore (+0.9% MoM), which pushed their share up marginally to 13.5%.
Active equity AUM saw a marginal 0.9% MoM contraction but posted significant YoY growth of 59.4%, contributing 44.4% to the total AUM. Active debt schemes were the growth drivers, with their AUM increasing by 4.3% MoM to Rs.17 lakh crore. This was the first time in 17 months that active debt scheme AUM increased.
However, on a YoY basis, the share of debt funds in the overall AUM has declined from 29.9% in October 2023 to 24.9%, mainly because of the elimination of indexation benefits in 2023.
The mutual fund industry had an outstanding performance in October, showing the dynamism and resilience of the asset class. It will be a good investment channel with long-term wealth creation abilities by riding the wave of increased investor interest in SIPs as well as active schemes going forward. Sustained inflow and new product innovation is likely to maintain the short-term growth momentum.
