The mutual fund sector in the nation witnessed assets under management (AUM) increase to Rs 66.7 lakh billion in 2024, and it is expected to exceed the 50-million unique investor base this year.
The phenomenal rise is projected as a result of ongoing equities market strength and an increase in new fund offers (NFOs). According to industry analysts, the investor base might exceed 100 million by 2030, with Rs 100 trillion in total AUM.
This boom will be driven by the market's durability, high retail involvement, favorable market circumstances, and a variety of investment options.
The net AUM of the Indian mutual fund sector surpassed Rs 65 lakh billion for the first time in August. Equity fund inflows totaled Rs 38,239 crore in August, up 3.03 percent from Rs 37,113 crore in July.
The systematic investment plans (SIPs) achieved new highs in August, with monthly contributions totaling Rs 23,547 crore, up from Rs 23,332 crore the previous month.
The surge comes as investors from smaller cities in India embrace mutual funds like never before, with the percentage of such investors in cities outside the top 15 increasing dramatically over the previous four years.
While Mumbai and Delhi continue to attract the most investors, accounting for 39% as of June 2024, other cities have consistently contributed more than 30% of investors since March 2021, according to a Franklin Templeton analysis.
Experts believe that inflows into mutual funds are a significant source of liquidity for the equities markets, since record SIP collecting absorbs any selling pressure. SIPs continue to rise by roughly 1% each month, which is highly positive for the industry's long-term growth and allows investors to raise their equity allocation in a systematic manner.
