Investments in equity MF at 94,151 cr in June qtr

New Delhi: Investment in equity mutual funds surged over five-fold to Rs 94,151 crore in the June 2024 quarter against Rs 18,358 crore a year ago, driven by a strong economic environment, supportive government fiscal policies, investors confidence and robust stock return. This has also pushed the industry's assets under management (AUM) by 59 per cent to Rs 27.68 lakh crore in June from Rs 17.43 lakh crore a year ago, data from the Association of Mutual Funds in India (AMFI) showed. The robust gain in the asset base was also replicated in the growth of investors in equity mutual funds, with the number of folios closing at 13.3 crore, adding an investor base of over 3 crore. The significant gain in equity folios indicates broader participation across investor segments, driven by improved financial literacy and accessible investment platforms, Trivesh D, COO of stock trading platform Tradejini, told.

According to the AMFI data, equity-oriented mutual fund schemes invested Rs94,151 crore in the quarter ended June 2024. This comprises Rs18,917 crore in April, Rs34,697 crore in May and Rs40,537 crore in June. The investment in equity-oriented mutual funds jumped five-fold to Rs94,151 crore in the June quarter from Rs18,358 crore in the quarter ended June 2023 and increased 32 per cent from Rs71,280 crore witnessed in the preceding March 2024 quarter.

“The confluence of political stability, supportive government policies, and a favourable economic environment has significantly contributed to the impressive inflows into equity mutual funds, signalling a positive outlook for the sector,” Trivesh said.

Strong macroeconomic fundamentals, bolstered by supportive government fiscal policies like higher-than-budgeted tax collection growth, reduced revenue expenditures, and increased capital spending have helped in increasing the allocation to equity mutual funds, Feroze Azeez, Deputy CEO, Anand Rathi Wealth, told.

He further said that investors’ confidence in the markets and historically strong returns given by Indian equities with relatively low risk also helped investors to move towards equity mutual funds. Additionally, the shift was further fuelled by a transition from traditional investments like deposits to mutual funds in pursuit of higher returns.