Mutual Funds jump 41% in FY21, gain from equity highs

MUMBAI: Strong inflows in sectoral & thematic, tax savings and midcap schemes helped the mutual fund (MF) industry reverse its eight-month trend of net outflows from equity plans in March 2021. The month also witnessed, for the first time ever, inflows through systematic investment plans (SIPs) cross the Rs 9k cr mark, data from industry trade body AMFI showed.
The data for fiscal 2021 also showed that the fund industry had grown its assets under management (AUM) by 41% to Rs 31.4 lakh crore. This came mainly because of the smart recovery in the stock market in the last one year after leading indices had reached multi-year lows just a week before the end of fiscal 2020.
AMFI data showed that during March this year, equity funds witnessed a net inflow at Rs 9,115 crore. A little over Rs 2,000 crore net inflow came in through thematic & sectoral funds, Rs 1,552 crore through ELSS and Rs 1,503 crore through midcap funds.

Debt funds, however, continued to record net outflow at Rs 52,528 crore, mainly because corporates took money out of liquid and low-duration funds to meet their advance tax liability during March. This is a normal affair that is seen every quarter, fund industry players said.
FY21 also recorded good growth of MF assets from places that are outside of the metros and top cities, called Beyond 30 or B30 locations in industry parlance. According to AMFI chief executive N S Venkatesh, FY21 saw rising acceptance for MFs from tier-2 and -3 locations, with MF AUM from B30 rising 54% to Rs 5.4 lakh crore by the close of the year, compared to Rs 3.5 lakh crore a year earlier.
The year also saw the average AUM by SBI MF crossing the Rs 5-lakh-crore mark. The fund house is the first one to achieve this milestone.

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