In the face of extremely volatile flows, India’s monthly net inflows through Systematic Investment Plans (SIPs) have held steady above ₹8,000 crore for the past year. This puzzle has caused much bewilderment among India’s mutual fund analysts and industry professionals. A deeper look at AMFI data on SIP flows, holds out some answers.
An AMFI data sheet disclosed to fund houses but not the public provides further details on the age and composition of SIP numbers. Mint has seen a copy of the sheet. It shows that just ₹3.12 lakh crore of India’s 27 lakh crore mutual fund assets is a result of SIPs. In other words, SIPs exert a very small influence (11.55%) on India’s mutual fund assets. This explains why SIP numbers at 8,273 crore in November held steady, even as net inflows in open ended equity and hybrid funds plunged to ₹740 crore. “The SIP flows are too small to move the needle on overall net flows. The November flows are largely a result of redemptions on the lump sum side," said Swarup Mohanty, CEO, Mirae Asset Mutual Fund.