The mutual fund industry in India has maintained its robust growth trajectory in 2024. This marks a significant rise of Rs 17 lakh crore in assets.
This impressive surge was driven by favourable equity markets, strong economic performance, and increased investor participation. Experts predict the growth momentum will extend into 2025.
According to Kaustubh Belapurkar, Director-Manager Research, the mutual fund industry is expected to continue expanding in 2025. “With increased retail investor penetration, equity fund flows, particularly through Systematic Investment Plans (SIPs), are likely to remain strong”, he added.
The industry’s assets under management reached a high record of Rs 68 lakh crore by the end of November 2024, up 33% from Rs 50.78 lakh crore at the end of 2023. This marks a significant leap from the previous year’s 27% rise.
The 2024 growth is even higher than the modest increases seen in previous years.
The year 2024 saw an inflow of Rs 9.14 lakh crore, contributing to the strong growth in AUM. The year also witnessed an increase of 5.6 crores in investor accounts.
SIPs, in particular, played a major role, with a contribution of Rs 2.4 lakh crore to the inflow, according to data from the Association of Mutual Fund Industry.
The mutual fund industry has consistently seen growth over the past four years. This sustained upward trajectory highlights the growing financialization of India.
The 2024 surge in mutual fund AUM was largely driven by investments in equity schemes, especially SIPs.
These schemes saw continued interest as retail investors looked for long-term returns in an expanding economy.
Ganesh Mohan, CEO of Bajaj Finserv AMC, highlighted the growing trend of financialization, which has contributed to the significant growth in AUM.
The year’s inflows included Rs 3.53 lakh crore into equity-oriented schemes, Rs 1.44 lakh crore into hybrid schemes, and around Rs 2.88 lakh crore into debt schemes.
These figures suggest that investors are diversifying their portfolios to capture both equity market growth and more stable debt returns.
As the mutual fund industry closes out a record year, experts predict continued growth into 2025. With strong inflows, especially in equity funds and SIPs, and an expanding base of retail investors, the sector is expected to maintain its upward momentum.
The shift toward financialization and increasing investor awareness will likely continue to support the mutual fund industry’s growth in the coming years.
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