Equity AUM Rises For 5 Successive Years

Net Inflows More Than Double In FY25

FinTech BizNews Service

Mumbai, 15 April, 2025:  Motilal Oswal Financial Services Ltd has come out with the FUND FOLIO report.  

Key observations

• The Nifty, after five consecutive months of decline, bounced back smartly in Mar’25 with a 6.3% MoM gain – the highest since Jul’24. During FY25, midcaps gained 7%, outperforming largecaps and smallcaps, which rose 5% each. Mar’25 recorded FII inflows after two consecutive months of outflows. FII inflows stood at USD0.2b in Mar’25 after outflows of USD5.4b/USD8.4b in Feb/Jan’25. Conversely, domestic inflows moderated to USD4.3b in Mar’25 from USD7.4b/USD10.0b in Feb/Jan’25.
• However, despite the challenges, domestic MFs saw their equity AUM rise for the fifth consecutive year to INR32.3t (+26% YoY) in FY25. AUM growth was fueled by an uptrend in market indices (Nifty: +5% YoY) and higher sales of equity schemes (at INR9,396b; +65% YoY). However, redemptions also rose 25% YoY to INR4,636b, leading to a rise in net inflows (more than double YoY) to INR4,760b in FY25 (all-time high) from INR1,971b in FY24.
• The MF industry’s total AUM increased 23% YoY (INR12.3t) to INR65.7t in FY25, propelled by the growth in equity funds (INR6,660b), liquid funds (INR1,580b), other ETFs funds (INR1,156b), balanced funds (INR1,096b), and income funds (INR933b).
• Investors continued to park their money in mutual funds as inflows and contributions in systematic investment plans (SIPs) stood at INR259.3b in Mar’25 (-0.3% MoM and +34.5% YoY).

Some interesting facts

• The year saw a notable change in the sector and stock allocation of funds. The weight of defensives improved 30bp to 29.7%, aided by an increase in the weights of Telecom and Healthcare, while the weights of Consumer, Technology, and Utilities moderated (refer to page 4 for detailed charts).
• The weight of Domestic Cyclicals too increased 30bp to 61.5%, led by Banks-Private, Retail, Insurance, Real Estate, Infrastructure, and Cement.
• Global Cyclicals’ weightage declined 70bp to 8.7%, dragged down by Oil & Gas.
• Healthcare saw a rise in weight to 7.6% (+20bp YoY) in FY25, improving its position to fourth from fifth a year ago.
• Technology’s position remained unchanged over the last one year, while its weightage declined by 20bp YoY to 8.5%.
• Private Banks saw a surge in weight to 18.4% (+150bp YoY).
• PSU Banks witnessed a decline in weight to 2.8% (-60bp YoY).
• Capital Goods saw a decrease in weight to 7.2% (+70bp YoY).