Driven by the continuing inflows into equity funds especially through the SIPs route, the overall assets under management (AUM) of the mutual fund industry crossed the Rs 60-trillion milestone and touched Rs 61.16 trillion in June, an increase from Rs 58.91 trillion in the previous month, on the back of a record 7 percent rally in the equity market.
According to the industry lobby Association of Mutual Funds (Amfi), this is the first time that the AUM has risen past the Rs 60-trillion mark and was led by the inflows via systematic investment plans, which rose to Rs 21,262 crore in the reporting month as against Rs 20,904 crore in April.
Equity mutual fund inflows have surged 83.42 percent to a record high of Rs 34,697 crore in May.
Of the total AUM, retail AUM stood at Rs 36,32,226 crore for June with an average AUM of Rs 35,69,980 crore.
Mutual fund folios were at an all-time high at 19,10,47,118 in June of which retail folios (equity, hybrid and solution oriented schemes) were also at an all-time high at 15,32,56,488 for the month compared to 14,89,54,824 in May.
June marks 40 months of positive equity inflows, starting from March 2021. Growth equity fund inflows for June was Rs 40,608.19 crore.
The number of new SIPs registered in June stood at 55,12,962 and the SIP AUM rose to the highest to Rs 12,43,791.71 crore compared to Rs 11,52,801 crore for May. This had SIP contribution rising to an all-time high of Rs 21,262.22 crore from Rs 20,904.37 crore in May. The number of SIP accounts also stood at the highest ever at 8,98,66,962 in June compared to 8,75,89,485 in May.
Inflows into equity mutual funds surged by 17 percent to Rs 40,608.19 crore in the month, a fresh high according to the latest data released by the Amfi on Tuesday.
The net inflow into equity mutual funds had surged by 83.42 percent to a record high of Rs 34,697 crore a month ago.
Despite the wild optimism over a flooding of dollars into the country after the government bond inclusion into the JP Morgan bond index from June 28, debt mutual funds saw net outflows to the tune of Rs 1,07,357.62 crore during the month and the Amfi chief executive Venkat Nageswar Chalasani dismissed outflow as seasonal typical of every quarter ending.
Overall, open-ended mutual funds saw net outflows of Rs 43,108.80 crore during the month, even as inflows into open-ended equity funds have remained in the positive zone for the 40th month in a row.
The investment via systematic investment plans (SIPs) rose to Rs 21,262 crore in June from Rs 20,904 crore in May.
SIP inflows, NFO collections and lumpsum purchases on the days when markets saw correction led to record inflows to equity funds in the month. As the confidence grows, repeat investments and word of mouth is leading to this movement in flows and industry growth, said Manish Mehta of Kotak Mahindra AMC.
Data show that most inflows among equity funds have came through sectoral/thematic funds-- fuelled by nine new fund offers which collected Rs 12,974 crore--with the category getting net investment of Rs 22,351.69 crore in the reporting month.
Within equity funds, multicap funds inflows rose 78 percent to Rs 4,708.57 crore, while investments into largecap funds rose 46 percent to Rs 970.49 crore but smallcap funds saw 17 percent dip in inflows to Rs 2,263.47 crore, while investments into midcap funds slipped 3 percent to Rs 2,527.84 crore.
Among debt funds, liquid funds saw net outflows of Rs 80,354.03 crore while overnight fund category also saw net outflows of Rs 25,142.72 crore. And both Amfi and industry experts attributed this to advance tax payments and other quarter-ending accounting and financial necessities.
According to Viraj Gandhi of Samco MF, the party on Dalal Street in the month was the primary reason for the same rocking party on the MF street. “How can mutual funds not join in on the party while it's happening on the equity street? An astounding infusion of Rs 40,608 crore, a record high, into equity plans. The sectoral funds made the largest contribution, totaling Rs 22,351 crore, followed by the multicap funds, which contributed Rs 4,708 crore,” he said.