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An analysis of gross SIP inflows done by Cafemutual reveals that equity funds, hybrid funds and index funds are the top three preferred choices for SIP investors.
Majority of gross SIP inflows i.e. 82% goes to equity funds. Of the total gross SIP inflows of Rs.24,500 crore, equity funds received gross SIP inflows of Rs.20,000 crore in September 2024.
Hybrid funds and index funds occupy the next two spots with gross monthly inflows of Rs.1600 crore and Rs.1200, respectively. They account for 7% and 5% of the total SIP inflows.
Here is a table with the monthly SIP contribution for September 2024:
|
Category (2024) |
SIP Contribution (Rs. crore) |
Market Share (%) |
|
Equity funds |
19,999.39 |
81.60 |
|
Hybrid funds |
1,610.26 |
6.57 |
|
Index funds |
1,157.85 |
4.72 |
|
Debt funds other than liquid and overnight funds |
636.01 |
2.60 |
|
Liquid/Overnight funds |
528.72 |
2.16 |
|
Other funds (other than Index funds & including FoF-domestic) |
353.8 |
1.44 |
|
Solution oriented schemes |
222.69 |
0.91 |
In terms of no. of live SIP accounts, equity funds are the front runners with 8 crore live SIP accounts. Hybrid and index funds again follow equity funds with 60 lakh and 46 lakh live SIP accounts, respectively.
Currently, the MF industry has 10 crore live SIP accounts in September 2024.
Let us look at this table to know more:
|
Category (2024) |
No. of live SIP Accounts |
Market Share (%) |
|
Equity funds |
8,05,39,560 |
81.56 |
|
Hybrid funds |
59,78,187 |
6.05 |
|
Index funds |
46,42,644 |
4.70 |
|
Debt funds other than liquid/overnight funds |
27,74,223 |
2.81 |
|
Liquid/Overnight funds |
23,33,040 |
2.36 |
|
Other funds (other than Index Funds & including FoF-Domestic) |
17,28,146 |
1.75 |
|
Solution oriented funds |
7,48,371 |
0.76 |
In terms of SIP AUM, the total SIP AUM in September 2024 is Rs. 14 lakh crore.
Equity funds make up 87% of total SIP AUM, contributing Rs.12 lakh crore. Hybrid schemes and index funds contribute Rs. 91500 crore and Rs. 33500 crore respectively, to the SIP AUM kitty.
Here is a table with SIP AUM for September 2024:
|
Category (2024) |
SIP AUM (Rs. in crore) |
Market Share (%) |
|
Equity funds |
12,07,057.73 |
87.36 |
|
Hybrid funds |
91,510.79 |
6.62 |
|
Index funds |
33,451.18 |
2.42 |
|
Solution oriented funds |
22,151.94 |
1.60 |
|
Other funds (other than Index Funds & including FoF-Domestic) |
17,299.37 |
1.25 |
|
Debt funds other than liquid/overnight funds |
9,377.59 |
0.68 |
|
Liquid/Overnight funds |
855.35 |
0.06 |
Delhi MFD Retd. Col. Sanjeev Govila of Hum Fauji Initiatives believes that herd mentality has contributed to increase in equity SIP contributions. He said, “Markets are going up due to herd mentality. Investors want to get into the latest trend that is going on, without necessarily understanding the long-term benefits of equity. What is more is that most people are risk averse. Once a correction happens, people will change their minds. I also think there are currently misconceptions surrounding debt funds. Debt funds will provide very good returns over the next three years considering the interest rate cycle which is heading downward.”
Goa MFD Celso Fernandes of Navemarg Foundation believes investors have begun overdiversifying their portfolios. He said, “Instead of focusing on increasing the number of units in a particular scheme, some investors focus on increasing the number of schemes in a portfolio, even with small SIPs of Rs. 5000 through equity NFOs.”
