Strong participation from retail investors by way of systematic investment plans (SIPs) led to the total assets under management (AUM) of mutual funds rise to ₹22.24 lakh crore in October — an increase of 0.87% compared with the previous month, as per an analysis by ICRA.
As per the rating agency, October saw SIPs contributing ₹7,985 crore to AUM, which was a tad higher than the previous month’s flows of ₹7,727 crore. The number of folios also increased to 7.90 crore, a rise of 1.47% over September. “The increase reflects consistently strong participation from retail investors through systematic investment plans (SIPs),” said ICRA.
Further, the AUM and the number of folios registered a year-on-year rise of 3.84% and 25.12%, respectively.
While 11.45 lakh new folios were added in October, 10.02 lakh folios were for equity category, including equity-linked savings scheme (ELSS). Balance and liquid categories added 0.58 lakh and 0.67 lakh folios respectively while folios in income and gold exchange traded fund (ETFs) categories declined.
In terms of AUM as well, equity including ELSS, balanced and other ETFs saw a marginal fall of 0.87% at ₹10.06 lakh crore in October though when compared with the corresponding month of last year, it rose almost 10%.
MFs see net inflows
On an overall basis, mutual funds saw net inflows of ₹35,529 in October — a reversal of trend of the previous month as liquid/money market category once again saw net inflows after a month of outflows. Outflows, however, continued in the income category.
“Despite volatility in the equity market, equity funds (including ELSS) witnessed net inflow of ₹12,622 crore in October 2018, up 12.98% MoM (month-on-month). Benchmark index Nifty 50 saw corrections of around 5% in the period,” said ICRA, adding that data from Association of Mutual Funds in India (AMFI) showed that inflows into equity schemes were positive for the 53rd consecutive month.
Interestingly, at a time when the Securities and Exchange Board of India (SEBI) is pushing mutual funds to encourage investments from beyond the metros and top towns, the share of smaller towns or B30 (beyond top 30 cities) accounted for 14.78% of the average AUM at the end of October.
In May 2018, the share of B30 was pegged 13.83%.
