MF assets rise a record Rs1,69,000 cr to Rs22,79,000 cr in November

Total assets under management (AUM) of mutual funds in India increased by a record Rs1,69,000 crore to Rs22,79,000 crore, making it the best year in terms of net inflows in the history of India's mutual fund industry.

The latest AMFI data shows that equity funds (including equity-linked savings schemes and Equity ETFs) received record net inflows of Rs32,755 crore in November 2017. The large inflows in Equity ETFs (Rs12,447 crore) was primarily due to the launch of government's Bharat 22 ETF, which mopped up Rs14,499 crore. Other equity new fund offers (NFOs) collected Rs3,160 crore.

MFs were net buyers of equity worth Rs10,700 crore in November while foreign portfolio investors (FPIs) sold stocks worth over Rs13,500 crore during the month.

Assets under management (AUM) of equity MFs stood at Rs22,79,000 crore, up 6.5 per cent in November, with equity, balanced and debt schemes all witnessing steady inflows.

Including balanced funds, net inflows into equity funds ballooned to Rs40,369 crore. From merely Rs13,370 crore in April 2014, balanced funds AUM has reached Rs1,55,000 crore in November 2017, an increase of 1060 per cent.  Balanced funds invest a minimum of 65 per cent in equity. As a result, the year to date (YTD) inflows in equity funds (including ELSS, balanced funds and Equity ETFs) stood at Rs1,98,000 crore.

Industry estimates suggest that arbitrage funds received Rs2,000-Rs2,500 crore while the bulk of the inflows have flowed in pure equity funds.

A steady inflow of funds to mutual funds also helped the equity market in India witnessed only a 3-4 per cent fall for the whole of 2017 despite massive selling by FPIs in the stock market.

MFs are witnessing such high inflows nearly a decade after the 2008 financial crisis, which saw investors turning away from equities.

The latest AMFI data shows that equity funds (including equity-linked savings schemes and Equity ETFs) received record net inflows of Rs32,755 crore in November 2017. The large inflows in Equity ETFs (Rs12,447 crore) was primarily due to the launch of government's Bharat 22 ETF which mopped up Rs14,499 crore. Other equity new fund offers (NFOs) collected Rs3,160 crore.

The monthly SIP inflows which averaged Rs3,000 crore last fiscal has doubled to almost Rs6,000 crore this year. The industry has collected Rs34,887 crore during April-October 2017 through SIPs, taking the total SIP folios to 17.3 million. The Individual investors, who mainly invest through SIPs, now comprise 48.5 per cent of all SIP investments in September 2017 against 45.4 per cent of overall assets in October 2016.

The AUM of pure equity funds, which includes arbitrage funds, touched Rs6,56,000 crore in November. Besides equity, liquid and income funds collectively mopped up Rs86,782 crore in November which helped industry's asset base touch a new high of Rs22.76 lakh crore.

Since demonetisation, flows into mutual funds have been very strong, especially in equity and balanced funds. From November 2016 to October 2017, equity funds have received inflows of Rs1,35,000 crore and balanced funds have received Rs74,000 crore.