Mutual Fund AUM at all-time high of Rs 66.70 lakh crore in August: AMFI

The mutual fund industry AUM has hit an all-time high of Rs 66.70 lakh crore, led by net inflows across open-ended categories and mark-to-market (MTM) gains in the equity market. The industry AUM rose by 2.7% or Rs 1.74 lakh crore in absolute terms from Rs 64.97 lakh crore in July, according to a monthly note by the Association of Mutual Funds in India (AMFI).

The assets under management of growth/equity oriented schemes closed at an all-time high of Rs 30.09 lakh crore led by strong inflows and MTM gains. This is around 45% of industry AUM. Also Read | This defence mutual fund yielded 85% return since inception. Time to make allocation in this sector?

The monthly note also stated that, “Equity AUM increased by Rs 75,055 crore led by MTM gains and strong inflows. Strong signals of an imminent rate cut by the US Fed in the near future, coupled by continued buying by domestic institutional investors (DIIs) and foreign institutional investors (FIIs) helped the domestic equities to touch all-time high during the month.”

The sectoral/thematic category witnessed highest inflows in August, led by funds mobilised through new fund offers (NFOs). Similar to July, more than 50% of the inflows in the sectoral/thematic category were led by funds mobilised through the NFOs launched in August.

The income/debt oriented schemes assets reached an all-time high of Rs 16 lakh crore in August. This surge was fuelled by the liquidity surplus in the banking system, resulting from high government spending, which pushed government bond yields to almost two-year lows. The inflows remained positive for the second month in a row, at Rs 45,169 crore. Debt funds emerged as the preferred choice for global investors, seeking stability amid growth concerns. As US manufacturing data revealed signs of contraction, investors globally, including in the US, shifted toward safer investment options such as bond and money market funds, seeking stability, said the note.The hybrid category assets were recorded at a fresh high of Rs 8.61 lakh crore. The inflows totalled to Rs 10,005 crore in August. Among all the hybrid mutual fund categories, dynamic asset allocation and multi-asset allocation funds accounted for almost 60% inflows in the category. The category had one NFO which mobilised Rs 1,297 crore in the month.

Also Read | This large & midcap fund turns Rs 10,000 monthly SIP into Rs 9 lakh in 4 years

Among the passive funds, the AUM was at a record high of Rs 11.21 lakh crore which was approximately 17% of industry AUM. Other ETFs received the highest inflows of Rs 10,094 crore. Gold ETFs witnessed the highest ever inflows of Rs 1,611 crore in August, following customs duty reduction. The assets grew 8.5%, the highest within the passive funds category. As gold prices rise and the yellow metal’s safe-haven appeal strengthens, investors are increasingly favouring a more diversified investment strategy to allocate their funds

The monthly SIP contribution touched a new high of Rs 23,547 crore in August. This, coupled with the MTM gains, helped the SIP assets grow 2.3% to Rs 13.39 lakh crore. The SIP accounts crossed 9.61 crore, with monthly net account addition at 27.40 lakh.

In August 2024, the mutual fund industry reached a new milestone, with the total folio count up 3.1% to 20.45 crore vs 19.84 crore in July, adding more than 61 lakh new folios. Over 46 lakh new accounts were opened in retail-focused schemes such as equity, hybrid, and solution-oriented, with the remaining categories adding 15 lakh new accounts.

“The industry assets rose to a new high, with an asset base of Rs.66.70 lakh crore at the end of August 2024. The positive inflow, along with folio count surpassing 20 crores, reflect investor confidence and a growing appreciation for mutual funds as a preferred investment avenue. The steadily increasing SIP contribution of Rs. 23,547 crores in August 2024 highlights the shifting investor sentiment towards disciplined and long-term wealth accumulation,” said Venkat N Chalasani, Chief Executive – AMFI.

“As mutual funds remain a key stabilising factor for equity markets in India, our commitment towards transparency and excellence remains resolute as we strive to deliver exceptional investment experience and adapt to the evolving needs of our investors,” he added.