MUMBAI: Assets under management (AUM) of the mutual fund industry witnessed a growth of 41 per cent in the last financial year to touch a new high of Rs 31.4 lakh crore.
The growth was primarily led by an increase in AUM of equity funds (Rs 4.09 lakh crore), income funds (Rs 2.39 trillion) and other ETFs (Rs 1.29 lakh crore), said the Fund Folio report from Motilal Oswal Financial Services.
Equity AUM, including ELSS and index funds, of domestic mutual funds reached new highs of Rs 10.2 lakh crore (up 67 per cent YoY) in FY21, led by a rise in market indices.
“The year saw a decline in sales of equity schemes (down 7 per cent YoY to Rs 2, 306 billion (Rs 2.30 lakh crore). The pace of redemptions picked up to Rs 2, 653 billion (Rs 2.65 lakh crore) (up 64 per cent YoY), leading to the first ever net outflows in seven years at Rs 347 billion (Rs 34, 700 crore) in FY21, ” it said.
Financial year 2020-21 saw a notable change in the sector and stock allocation of funds. The weightage of domestic cyclicals increased by 160 basis points to 58 per cent, led by an increase in the weightage of automobiles, NBFCs, cement, real estate, chemicals and infrastructure.
Technology saw a massive rise in weightage in FY21 to 11.9 per cent (up 300 bps YoY). The sector is now the second in terms of sectoral allocation by MFs.
It was in the third position 12 months ago. Weightage of defensives decreased 100 bps to 32.5 per cent, led by consumer, utilities, and telecom. global cyclicals’ weightage, too, fell 60 bps to 9.5 per cent.