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Inflow into mutual funds through systematic investment plan is all set to hit record high this fiscal despite upheaval in market on the back of Russia-Ukraine warupsetting the global economies that were recovering from the Covid pandemic.
Steady rise
The mutual fund industry SIP inflows have already jumped 29 per cent in the first 11 months of this fiscal to ₹112,238 crore against ₹86,898 crore logged in the same period last fiscal.
The average SIP inflow so far this fiscal has increased to ₹9,353 crore against ₹7,241 crore recorded last financial year.
The monthly inflow which started increasing from last April at ₹8,596 crore has never dropped even for a single month till it touched ₹11,517 crore in January despite volatile equity market. However, it dipped marginally for the first time this fiscal to ₹11,438 crore in February.
DP Singh, Chief Business Officer, SBI Mutual Fund, said though the inflows in March will be little lower than last month due to financial year end planning by investors, the growth trend in SIP will continue for next six months and next fiscal inflows will be much higher on the back of increased mutual fund market penetration and investors’ behavioural maturity.
New folios
SBI Mutual Fund, the country's largest fund house, has registered over 30 lakh new SIPs this fiscal as of January-end, recording a growth of 39 per cent over last fiscal. The fund house received an average monthly SIP flow of over ₹1,800 crore in the current financial year with the average ticket size of about ₹2,500.
"Over 50 per cent of our SIP from tier-II and -III backed by the strong banking distribution channel and multi-fold increase in investors confidence after their experience in last 3-4 years," said Singh.
Similarly, Nippon India MF SIP inflow increased 14 per cent to ₹2,010 crore in the December quarter against ₹1,770 crore in same period last year.
Manish Kothari, Co-founder and CEO, ZFunds said there are indications of a strong upward trend of SIPs in equity MFs and is expected to continue despite the marginal fall in February largely due to lower number of days.
Investors in smaller towns are attracted to MFs due to growing awareness on possibility to invest as little as ₹100 per month, he said.
Ujjwal Jain, CEO and Founder, WealthDesk, said the dip in SIP flows last month needs to sustain for at least 2-3 quarters for one to see it as a clear trend and there no big reason for the inflow to taper as the domestic growth prospects are still strong despite global concerns.
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