The Rs.23 lakh crore mutual fund industry has added over 29 lakh equity folios in April-June 2018. Equity folios include pure equity funds, ELSS, balanced funds and ETFs that track indices. Meanwhile, the industry added over 32.77 lakh folios in April-June 2018. This means that, 89% of new folios were in equity funds. The total equity folios was 6.31 crore as on June 2018.
Radhika Gupta, CEO Edelweiss AMC expects the equity folio growth to slow down in near term due to heightened volatility. However, the medium to long-term folio growth is expected to remain strong.
Demonetization has clearly given a big fillip to ‘financialisation’ of household savings believes Radhika. “Mutual fund inflows have experienced a substantial leap post demonetization and the trend is still going strong. Moreover, ‘Mutual Fund Sahi Hai’ campaign has garnered a lot of interest amongst various class of investors, who are now looking at mutual funds as a preferred investment option. We expect this trend to continue going forward as investors are starting to acknowledge the long-term wealth creation potential of mutual funds. In 2018, money flocked into mutual funds despite single digit returns. The investors now understand the benefits of long-term investing and how SIP work like magic if they persist during the entire market cycle. We expect robust inflows through the SIP route from retail investors and B30 cities in coming years,” says Radhika.
Swarup Mohanty CEO, Mirae Asset Global Investments (India) believes that the folio growth is a direct reflection of the increase in SIP investors. “As SIPs are predominantly in equity schemes, the equity folios have increased. I feel there is still a huge scope of growth in SIP book from current levels. I expect the folio growth to remain healthy over the next 2-3 years, as long as the SIP book continues to grow.”
In percentage terms, ETF folios grew at 15% outpacing all the other categories. This is largely due to launch of Bharat 22 ETF. Closely following ETFs was the liquid category, which recorded a 12% rise in folios and overseas FOF with a 10% increase.
Folio Data
|
Category |
No. of folios as on March 2018 |
No. of folios as on June 2018 |
Change |
Change (%) |
|
Equity |
4,31,20,298 |
4,55,07,516 |
23,87,218 |
6% |
|
ELSS |
1,04,14,687 |
1,06,68,446 |
2,53,759 |
2% |
|
Balanced |
58,89,085 |
60,43,544 |
1,54,459 |
3% |
|
ETFs |
7,51,947 |
8,68,360 |
1,16,413 |
15% |
|
Gold ETFs |
3,29,343 |
3,25,919 |
-3,424 |
-1% |
|
Income Funds |
95,77,218 |
98,11,465 |
2,34,247 |
2% |
|
Gilts |
75,553 |
67,488 |
-8,065 |
-11% |
|
Liquid |
10,95,226 |
12,27,930 |
1,32,704 |
12% |
|
Overseas FOFs |
93,859 |
1,03,465 |
9,606 |
10% |
|
Total |
7,13,47,301 |
7,46,24,230 |
32,76,929 |
5% |
Source: SEBI
