Despite the pullback in flows, the mutual fund industry’s total assets under management (AUM) rose 22.55% year-on-year to ₹72.20 lakh crore in May.
Open-ended growth or equity schemes reported the highest growth at 26.21%, followed by other open-ended schemes (24.45%) and hybrid funds (22.12%).
In the passive category, Gold ETFs saw the highest year-on-year growth at 97.08%, with AUM reaching ₹62,453 crore. Index funds grew 30.95% to ₹3.00 lakh crore, ICRA Analytics noted.
Within equity schemes, sectoral/thematic funds led with 45.99% annual AUM growth, followed by multi-cap funds at 40.37%. On the debt side, long-duration funds posted a 53.15% rise, while money market and ultra short-duration categories grew 44.49% and 32.51%, respectively.
The fall in equity inflows comes amid heightened global inflation concerns and geopolitical tensions, including India’s Operation Sindoor, the report said.
Net inflows into domestic ETFs (excluding Gold ETFs) also declined 78.55% month-on-month in May, after touching a record high of ₹19,057 crore in April.
Meanwhile, investor interest in systematic investment plans (SIPs) remained resilient. The number of outstanding SIP accounts grew 3% to 905.57 lakh in May 2025, while contributing SIP accounts rose 30% to 856 lakh. SIP contributions increased 28% year-on-year to ₹26,688 crore. SIP AUM also rose 27%, and its share in total AUM stood at 20.24% in May, up from 19.57% a year ago.
The number of mutual fund folios also increased 28.15% year-on-year. Growth was strongest in the “other schemes” category, which includes ETFs, index funds, and overseas fund-of-funds, with folios rising 43.29%. Equity folios grew 28.80%, while debt folios edged up by 0.89%.
ICRA Analytics said the long-term growth in AUM and SIP accounts shows strong retail participation, but short-term equity flows are likely to stay vulnerable to global macro events.