MF industry collects net inflows of Rs.3.50 lakh crore in FY 2016-17

FY 2016-17 ended on a positive note for the Indian mutual fund industry. The industry has witnessed a triple-digit growth of 155% in its net inflows i.e. from Rs.1.34 lakh crore in FY2016-17 to Rs.3.43 lakh crore in FY 2016-17, an addition of Rs.2.08 lakh crore. This growth is largely due to massive inflows in equity funds including ELSS, ETFs and balanced funds, shows AMFI data.

Experts attribute this growth to increasing demand of investors in balanced funds. The category has mopped up net inflows of Rs.36,610 crore in FY 2016-17 compared to Rs.16,867 crore in FY 2015-16, a whopping growth of 85%. “Last fiscal has seen a rising investor interest in balanced funds. A part of this preference could be due to the fact that the industry has attracted new customers into equity, many of them prefer investing through balanced when they move from fixed income into equity,” said Vishal Kapoor, CEO of IDFC Mutual Fund.   

Suresh Soni, CEO of DHFL Pramerica Mutual Fund said, “SIP amounts and the number of SIPs are increasing which states that the trend is clearly positive. The balanced funds continue to see strong investor appetite which had led to the higher inflows.”                 

Another positive trend was witnessed in ETFs which track indices. The category has recorded net inflows of Rs.24000 crore in FY 2016-17 compared to Rs.8700 crore, an increase of 175% or Rs.15000 crore. The category has witnessed a record inflows last fiscal due to overwhelming response to the further fund offer of Reliance CPSE ETF and increase in EPFO’s contribution.

However, inflows in pure equity funds fell 11% in FY2016-17. These funds recorded net inflows of Rs.60270 crore in FY 2016-17 compared to Rs.67611 crore in FY 2015-16. This was primarily due to launch of close end equity funds in the preceding fiscal.

Overall, if we include ELSS, balanced funds and ETFs, inflows in equity category was up by 30% last fiscal.  As on March 2017, equity funds have recorded net inflows of Rs.1.31 lakh crore while it was Rs.1.02 lakh crore in the preceding fiscal.

Of the total inflow of Rs.3.43 lakh crore, new schemes had collected Rs.36,093 crore last fiscal, which suggests that a major part of the inflows came to existing schemes.     

Among debt funds, income funds and liquids fund recorded net inflows of Rs.1.20 lakh crore and Rs.95000 crore on account of flow of institutional money in these segments. 

Yearly inflow/outflow

(Rs in Crore)

Source: AMFI