Key mutual fund trends observed in April 2025

20 May 2025 , 09:11 AM

MUTUAL FUND BRIEFING – APRIL 2025

April 2025 saw overall mutual fund AUM expand from ₹65.74 Trillion to ₹70.00 Trillion; supported by  MTM gains and net inflows of ₹2.77 Trillion. Active debt funds saw net inflows of ₹2,19,136 Crore, a reversal of March outflows. Active equity funds saw modest inflows of ₹24,269 Crore, sharply lower than the average of FY25. Real action was in alternates.

Hybrid funds saw net inflows of ₹14,454 Crore, after seeing marginal outflows in March. Passive funds saw robust inflows of ₹20,230 Crore. In equity funds, the centre of gravity finally moved out of sectoral and thematic funds. Gross SIP flows in April 2025 scaled a new high of ₹26,632 Crore, but SIP stoppage also spiked to record 298%.

KEY MUTUAL FUND TRENDS – SEGMENT LEVEL (APRIL 2025)

Here are mutual fund segment level trends for April 2025.

• Average assets under management (AAUM) of all mutual fund schemes surged on MOM basis from ₹66.70 Trillion to ₹69.50 Trillion in April 2025. The AAUM is crossed the December 2024 peak of ₹69.33 Trillion. Average AUM is 21.9% higher yoy.
• Last few years saw steady shift in AUM mix from active debt to active equity; but intensity has been reducing. The share of active equity funds in AUM for April 2025 was down 30 bps from 59.2% to 58.9% MOM; although AUM share is up 80 bps yoy.
• Passive fund share was 10 bps lower MOM at 12.5% in April 2025 but 30 bps lower yoy. The share of active debt funds fell 10 bps MOM from 15.1% to 15.0% in April 2025 while share is down 90 bps yoy. Liquid / money market funds share increased 30 bps MOM from 13.2% to 13.5% in April 2025, and also up 30 bps yoy.
• The AUM shares of individuals and institutions had approximately stabilized, although macro risks have made individual investors jittery. Between April 2024 and April 2025, the share of individual investors in overall MF AUM is down 60 bps from 60.5% to 59.9%. Individual share had peaked at 61.9% in September 2024, and has progressively fallen.
• How individual investors allocated across MF categories? As of April 2025, individual investors have a share of 35% in active debt funds but just 11% in short term money market schemes; a whopping 88% of equity fund assets, but just 13% of passive assets.
• What about an individual investor’s allocation basket? As of April 2025, individual investors have 86% of their MF portfolio in active equity schemes and 9% in active debt funds. Liquid funds at 2% and ETFs at 3% are fairly small. Institutions and corporates have 31% of their corpus in liquid funds, 27% in ETFs / FOFs, 24% in active debt funds and merely 18% in active equity funds.

As of April 2025, mutual fund AAUM grew 21.9% yoy. Assets of individual investors in this period grew 20.7% while AUM of institutional investors grew 23.8%.

KEY MUTUAL FUND TRENDS – FOLIOS AND TICKET SIZES (APRIL 2025)

Folios are investor accounts unique to an AMC; an approximation of retail intensity.

• There were 23.63 Crore folios as of the close of April 2025 of which retail investors accounted for nearly 91.7%. In addition, HNIs accounted for 7.8% of folios while institutions accounted for balance 0.5%. In case of active debt funds, retail investors account for 71.8% of folios, while HNI investors account for 26.0%. HNIs also have high share of folios of liquid funds (24.2%) and hybrid funds also 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 April 2025, the number of mutual fund folios have jumped from 3.95 Crore to 23.63 Crore. That is a jump of 498% in folios. Since Sep-14, folios have grown at CAGR of 18.41%.
• 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 -6% yoy at ₹1.80 Lakhs. For debt funds, average ticket size is up 10% yoy at ₹17.57 Lakhs. The net AUM of Indian mutual funds at ₹70.00 Trillion is spread across 23.63 Crore folios, giving a per folio ticket size of ₹2.94 Lakhs.
• Contrary to popular perception, retail investors are not myopic in their approach to equity funds. As of April 2025, retail investors hold 54.9% of equity fund assets and 44.3% of non-equity assets for over 2 years. Retail investors have held 73.6% of equity funds for minimum 1 year.

The per folio ticket size of retail investors has gone up sharply in the last one month, but that can be attributed to aggressive SIP closures.

KEY MUTUAL FUND TRENDS – GEOGRAPHICAL MIX (APRIL 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 April 2025 with March 2025, T30 assets were up 4.22% at ₹56.83 Trillion. Total assets of B30 centres also grew 4.08% to ₹12.66 Trillion. If we only look at the share of individuals; in April 2025, B30 cities accounted for 27.33% of individual assets while share of individuals in T-30 cities stood at 72.67%.
• Despite the Direct route available since 2013, only 46% of overall assets came through the Direct route, with just about 26% of retail investors and 28% of HNIs investors.

The volatility has impacted retail participation in April 2025, although that could very well be temporary.