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Business News/ Mutual Funds / Mutual fund assets skyrocket 35% in FY24, revealing key March trends

Mutual fund assets skyrocket 35% in FY24, revealing key March trends

Financial year 2024 marked unprecedented growth in AUM and expansion of the investor base, driven by individual investors. Stellar performance of equity-oriented categories, significant strides in hybrid funds, and rising adoption of SIPs were key highlights.

In FY 2024, the mutual funds industry saw a significant increase in AUM and investor base, driven by individual investors. Premium
In FY 2024, the mutual funds industry saw a significant increase in AUM and investor base, driven by individual investors.

Financial year 2024 has been a watershed moment for the domestic mutual funds industry, characterised by an unprecedented surge in assets under management (AUM). This surge, coupled with a substantial increase in the investor base, underscores a paradigm shift in investor behaviour and market dynamics.

Unprecedented growth in AUM

  • The mutual fund industry witnessed a historic surge in Assets Under Management by nearly 14 lakh crore, soaring to a record high of 53.40 lakh crore by March 2024 from 39.42 lakh crore in March 2023.
  • This remarkable growth rate of over 35% marks the highest since fiscal 2021, signifying a robust market performance and investor confidence.

Expansion of investor base

  • Accompanying the surge in AUM, the industry experienced a significant increase in the number of investors, with the number of folios reaching an all-time high of 17.78 crore.
  • The investor base expanded to approximately 4.46 crore, with women constituting approximately 23% and men around 77% of investors, reflecting a diverse and inclusive participation in mutual funds.

Industry asset growth
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Industry asset growth (AMFI)

Role of individual investors in driving growth

  • Individual investors emerged as the driving force behind the industry's growth trajectory, particularly in equity, hybrid, and solution-oriented schemes.
  • These categories collectively accounted for nearly 58% of industry assets and 80% of folio count by March 2024, indicating a growing trend of household participation in capital markets through mutual funds.

Individual investor-oriented schemes’ share of the industry
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Individual investor-oriented schemes’ share of the industry (AMFI)

Stellar performance of equity-oriented categories

  • Equity-oriented categories witnessed an outstanding growth of 55% during fiscal 2024, reaching 23.50 lakh crore in assets.
  • This growth was fueled by robust inflows and mark-to-market gains, with multi cap funds experiencing the highest growth rate of 85%.

Significant strides in hybrid funds

  • Hybrid funds crossed the 7 lakh crore mark, with asset gains exceeding 50%, driven by investors adopting an asset allocation approach and leveraging arbitrage opportunities in the market.
  • Dynamic asset allocation / balanced advantage funds emerged as the largest category within the hybrid funds segment.

Continued benefit for passive funds

  • Passive funds, particularly exchange-traded funds (ETFs), continued to benefit from institutional investment flows, amassing assets of 6.64 lakh crore as of March 2024.
  • However, debt funds saw moderate growth of around 7% during the fiscal year, reaching 12.62 lakh crore in assets, after experiencing contractions in the previous two fiscal years.

Rising adoption of SIPs

SIP fiscal year wise contribution
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SIP fiscal year wise contribution (AMFI)

Investor adoption of systematic investment plans (SIPs) continued to rise, with monthly net inflows touching approximately 19,300 crore in March 2024.

For fiscal year 2024, net inflows through SIPs stood at nearly 2 lakh crore, showcasing increasing investor confidence and commitment to disciplined investing.

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Deepika Chelani
A business media enthusiast. She covers personal finance beat for LiveMint.
Catch all the Mutual Fund news and updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
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Published: 16 Apr 2024, 01:55 PM IST
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