MF asset base up by Rs 11 trillion in 2023

NEW DELHI: After a lacklustre performance in 2022, the mutual fund industry saw a substantial rebound in 2023 with its asset base surging by nearly Rs 11 trillion, reaching over Rs 50 trillion-mark fuelled by an optimistic equity market, steady interest rates, and a robust economic expansion.

The year 2023 has seen a substantial increase in overall inflow, data from the Association of Mutual Fund Industry (Amfi) showed on Monday. The inflow has pushed the assets under management (AUM) of the mutual fund industry by 27 per cent, adding Rs 10.9 trillion in 2023. This was way higher than the 5.7 per cent growth and Rs 2.65 trillion increase in AUM observed throughout 2022, as well as the nearly 22 per cent growth and close to Rs 7 trillion addition to the asset base in 2021.

The asset base rose from Rs 39.88 trillion in 2022 to an all-time high of Rs 50.78 trillion in 2023, the data showed. The asset base stood at Rs 37.72 trillion at the end of December 2021 and Rs 31 trillion in December 2020. The 2023 also marked the 11th consecutive yearly rise in the industry AUM after a drop in two preceding years. This year growth in the industry was supported by inflows in equity schemes, especially through Systematic Investment Plans (SIPs).

Industry experts attributed the huge increase in asset base to rising equity markets, stable interest rates, and rising economic growth. The industry saw net inflows of Rs 2.7 trillion in 2023 as compared to an inflow of over Rs 71,000 crore in the preceding year. The huge inflow could be on the back of sustained investor interest in equity funds, arbitrage funds, and index funds & ETFs.