MUTUAL FUND BRIEFING – SEPTEMBER 2025
September 2025 saw total mutual fund AUM expand from ₹75.1 Trillion to ₹75.6 Trillion; largely on MTM gains. Active debt funds saw net outflows of ₹ (1,01,977) Crore, due to quarterly advance tax payouts. Active equity funds saw inflows of ₹30,422 Crore; with allocation and alpha hunting being the core themes. While Hybrid Fund flows were mellowed, the real action in September 2025 was seen in passive funds.
Hybrid funds saw subdued net inflows of ₹9,683 Crore, while passive fund inflows scaled ₹19,057 Crore. Equity fund demand gravitated towards allocation and alpha themes like flexi-cap, multi-cap, large & mid-cap, small cap, and mid-cap. Gross SIP flows in September 2025 scaled a record of ₹29,361 Crore, while NFO inflows were subdued at ₹1,959 Crore.
KEY MUTUAL FUND TRENDS – SEGMENT LEVEL (SEPTEMBER 2025)
Here are mutual fund segment level trends for September 2025.
- Average assets under management (AAUM) of all mutual fund schemes surged on MOM basis from ₹76.71 Trillion to ₹77.78 Trillion in September 2025. The AAUM is now at a new all-time high, with average AUM 14.4% higher yoy.
- Last few years had seen a steady shift in AUM mix from active debt to active equity; but that has stabilized. The share of active equity funds in AUM for September 2025 was up 60 bps from 59.9% to 60.5% MOM; while AUM share is down 50 bps yoy.
- Passive fund share was 30 bps higher MOM at 12.6% in September 2025 but 10 bps lower on yoy basis. The share of active debt funds was 30 bps lower MOM at 14.5% in September 2025 while share is up 30 bps yoy. Liquid / money market funds share fell 60 bps MOM to 12.4% in September 2025, but 30 bps higher on yoy basis.
- The AUM shares of individuals and institutions had approximately stabilized, although the fall in equity prices saw individual share rise in September 2025. Between September 2024 and September 2025, the share of individual investors in overall MF AUM is down 120 bps at 60.7%. Individual share peaked at 61.9% in September 2024, and has since stayed lower than that level.
- How did individual investors allocate across MF categories? As of September 2025, individual investors had a share of 33% in active debt funds but 11% in short term money market schemes; a whopping 87% of equity funds, but 14% of passive funds.
- What about an individual investor’s allocation basket? As of September 2025, individual investors have 87% MF portfolio in active equity schemes and 8% in active debt funds. Liquid funds at 2% and ETFs at 3% are small. Institutions and corporates had 28% of corpus in liquid funds, 28% in passives, 25% in active debt funds and 19% equity funds.
As of September 2025, mutual fund AAUM grew 14.4% yoy. Assets of individual investors in this period grew 12.1% while AUM of institutional investors grew 18.0%.
KEY MUTUAL FUND TRENDS – FOLIOS AND TICKET SIZES (SEPTEMBER 2025)
Folios are investor accounts unique to an AMC; an approximation of retail intensity.
- There were 25.19 Crore MF folios as of the close of September 2025 of which retail investors accounted for nearly 91.3%. In addition, HNIs accounted for 7.8% of folios while institutions accounted for the balance. In case of active debt funds, retail investors account for 72.0% of folios, while HNI investors account for 25.8%. HNIs also have high share of folios of liquid funds (24.3%) and hybrid funds at (24.2%).
- Between March 2009 and September 2014, mutual fund folios contracted from 4.76 Crore to 3.95 Crore. However, between September 2014 and September 2025, the number of mutual fund folios have jumped from 3.95 Crore to 25.19 Crore. That is a jump of 538% in folios. This is after elimination of 1.43 Crore dormant folios this year.
- Let us look at average ticket size for equity and debt products. For equity funds (predominantly a retail product), the average ticket size is down -4% yoy at ₹1.99 Lakhs. For debt funds, average ticket size is up 11% yoy at ₹19.23 Lakhs. The net AUM of Indian mutual funds at ₹75.61 Trillion is spread across 25.19 Crore folios, giving a per folio ticket size of ₹3.00 Lakhs; with average ticket size of equity funds at ₹2.08 Lakhs.
- Contrary to popular perception, retail investors are not myopic in their approach to equity funds. As of September 2025, retail investors hold 55% of equity fund assets and 42% of non-equity assets for over 2 years. Retail investors have held 75% of equity funds for at least 1 year.
While retail investors have an average account size of ₹86,877, the HNI investors have an average account size of ͅ₹9,74,295.
KEY MUTUAL FUND TRENDS – GEOGRAPHICAL MIX (SEPTEMBER 2025)
How are cities and towns contributing to the mutual fund growth story?
- The mutual fund market is divided into T30 (top-30) cities and B30 (cities beyond top-30). If you compare September 2025 with August 2025, T30 assets were up 1.12% at ₹63.28 Trillion. Total assets of B30 centres grew 2.57% to ₹14.50 Trillion. If we only look at the share of individuals; in September 2025, B30 cities accounted for 27.52% of individual assets while share of individuals in T-30 cities stood at 72.48%. Institutions have a T-30 bias due to apparent reasons.
- Despite the Direct route available since 2013, about 48% of overall assets came through the Direct route, with 27% of retail investors and 29% of HNIs investors. However, the recent volatility did underline the merits of taking the advisor (regular) route.
While direct investing is yet to pick up, it has also been observed that SIP stoppages are much higher in Direct Plans compared to Regular Plans. That is food for thought!