The assets under management (AUM) of the mutual fund industry is poised to double in the next five years, according to A. Balasubramanian, Chairman of Association of Mutual Funds in India.
Currently, the total assets—equity and debt—managed by 43 active asset management companies stands at Rs 19.04 lakh crore. This is three times the asset base five years back.
And while the growth rate may not be as spectacular going forward, Balasubramanian is confident that assets can still grow at a compounded rate of 20 percent for the next five years.
Two factors have been driving inflows into mutual funds. One has been the increasing shift away from physical assets like the real estate and gold because of poor returns. A good chunk of that money is now going into financial instruments, notably equities and mutual funds.