The new year started on a good note for the mutual fund industry. Inflows in equity funds increased from Rs 4,499 crore in December 2019 to reach Rs 7,877 crore in January 2020.
Inflows in Systematic investment plan (SIP) continued to be robust at Rs 8,532 crore. YTD inflows in SIPs stood at Rs 82,930 crore. As a result, the SIP folio base of the industry reached 3.04 crore in January 2020.
This coupled with healthy inflows in debt funds helped the industry clock a new high of Rs 28.18 lakh crore asset base in January 2020.
In January 2020, mid and small cap funds collectively mopped up net inflows of Rs 2,871 crore while large and multi cap funds received Rs 2,876 crore.
Among equity funds, large cap funds were the flavour in calendar year 2019, receiving the highest net inflows of Rs 11,182 crore, followed by multi cap funds (Rs 9,944 crore), mid cap funds (Rs 9,035 crore) and focused funds (Rs 8,069 crore).
“With overall sentiments improving on the back of softer crude oil prices and lower interest rates as also unconventional steps taken by RBI recently has led to expectations of further softening of interest rates. These factors should help to sustain the growth in equity markets in the near term,” said G Pradeepkumar, CEO, Union Mutual Fund.
The industry has grown from Rs 7.59 lakh crore in January 2010 to reach Rs 27.86 trillion as on 31 January 2020, which more than 3½ fold increase in a span of ten years. The total number of accounts (or folios as per mutual fund parlance) as on January 31, 2020 stood at 8.85 crore.
Debt Funds
Overnight funds have been gaining traction, which is evident by the increasing flows in this category, especially post the introduction of graded exit loads in liquid funds. In January 2020, overnight funds received Rs 22,652 crore. In 2019 calendar year, overnight funds received Rs 19,822 crore.
Inflows in liquid funds bounced back to Rs 59,682 core in January 2020 after seeing net outflows of Rs -71,159 crore in December 2019.
Banking and PSU Funds continued to drive investor attention with net inflows Rs 3,033 crore in January 2020. This category received combined inflows of Rs 34,578 crore last calendar year, which was the highest among all categories of debt funds. Overall, debt funds received net inflows of Rs 1.09 lakh crore in January 2020.
