Global India Mutual Fund Market Assessment, By Scheme Type (Debt-Oriented, Equity-Oriented, Money Market, ETFS, Others), By Type (Open-Ended, Close-Ended), By Distribution Channel (Banks, Financial Advisors, Direct Sellers, Others), By Investor Type (Individual, Institutional), By Region, Opportunities and Forecast, FY2018-FY2032

India mutual fund market size is expected to increase due to digital penetration, the performance of equity funds, diversification and low-cost portfolio management, retail participation, and established top fund houses.

India mutual fund market Size, Trends, Report 2031

A mutual fund is a consortium of money managed by an expert fund manager. It is a trust that collects money from many investors who share a common investment objective and invests the same in equities, bonds, money market instruments, and/or other securities. The NAV is the combined market value of the shares, bonds, and securities held by a fund on any day, after the deduction of permitted expenses and charges.
The mutual fund industry in India has experienced a surge in growth due to the increasing population and wealth of the nation. Funds invested in mutual funds can provide income for non-working individuals which has led to an increase in the number of individuals willing to invest in mutual funds. The total number of accounts as of April 2024, stood at INR 181.5 million, while the number of folios under equity, hybrid, and solution-oriented schemes, wherein the maximum investment is from the retail segment stood at about INR 145.4 million. &nbsp;Furthermore, the growing digital intrusion, the development of smart cities, and the improvement in data speeds have triggered the shift of asset shares towards more miniatured towns and cities. The increase in retail contribution through Systematic Investment Plans (SIPs) signifies the level of digitalization in India.
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<h2 style="text-align: justify;">Hike in Mutual Fund Assets</h2>
The hike in mutual fund assets can be credited to the strong performance of equity markets and boosted net inflows to equity schemes. The assets managed by domestic mutual funds (MFs) rose by 34 percent during FY2024. Mutual fund SIP contributions have increased more than three-fold over the past years. Both individual and institutional investors viewed a rise in the value of their assets held by mutual funds. This implies an optimistic opportunity that is expected to stimulate the growth of the mutual fund market. Several factors, including the increase in mutual fund investments, digitalization, government assistance, and increasing favoritism for mutual funds as a wealth-generation tool impel the growth of the mutual fund assets market. The above factors, liquidity, diversification, readiness, and transparency are expected to boost market expansion in the coming years. Despite a volatile financial market environment, high expense ratios, and sales charges, the mutual fund industry continues to thrive, offering investors opportunities for wealth creation.
<h2 style="text-align: justify;">Market Liquidity to Drive Market Growth</h2>
Liquidity refers to the ease of buying and selling an asset quickly and efficiently without significantly impacting its price. Mutual funds are an ideal example of a highly liquid financial market due to their composition and trading volume. Mutual funds usually invest in companies of various sizes, with larger companies offering higher liquidity. Moreover, these funds provide investors with a huge range of highly liquid assets, including stocks and fixed-income securities. The liquidity of mutual funds offers several merits, such as easy fund swapping and flexibility during market volatility. As a result, the market is expected to experience growth due to its high liquidity and associated benefits.
<h2 style="text-align: justify;">North India to Dominate the Market Share</h2>
North is estimated for maximum growth in India mutual fund market during the forecast period. The rise is attributed to phenomenal trading activities in the region and the large presence of the equity market. As most of the investors on the stock exchange are cost-aware, they look for low-cost brokerage options that make more buyers invest in mutual funds to eliminate the brokerage commission costs. With mutual funds, buyers can individually manage and sell stocks on the stock exchange. It will increase transparency in trading activities and allow steady communication between traders. Tax efficiency, transparency, and the ability to gain access to a centralized stock exchange platform make it a profitable security option for investors.
<h2 style="text-align: justify;">Equity Funds to Dominate India Mutual Fund Market Share</h2>
The market share growth in the equity funds segment will be significant during the forecast period. Equity mutual funds provide investors with exposure to corporate equities. There are various types of stock funds, each with its investment strategy. For instance, growth funds focus on stocks that have the potential for significant financial gains but may not pay regular dividends. Income funds, on the other hand, invest in stocks that offer regular dividends. Index funds track specific market indices, such as the Nifty50 Index and sector funds concentrate on a specific industry sector.
Equity funds are further categorized based on the portion of investment in the mutual fund. For instance, large-cap funds invest at least 80% of their assets in equity shares of large-cap companies, which are the top 100 companies in market capitalization. These funds provide stability and the capability for respectable returns. Mid-cap funds allocate a minimum of 65% of their holdings to equity shares of mid-cap companies, offering higher volatility and the potential for better returns than large-cap funds.
<h2 style="text-align: justify;">Bank Dominates the Share in India Mutual Fund Market</h2>
The bank segment has the biggest market share in India mutual fund market. In an array of market conditions, banking funds are preferably viewed as a suitable long-term investment solution. Over the past years, these funds have conveyed average annualized returns of over 17%. Furthermore, by providing specialized, value-added financial services to investors and increasing their customer base, mutual fund, and insurance subsidiaries aid banks in grasping their full potential. Banks may form their subsidiaries or partner with an MF arm. Any investment account, such as an IRA, which may be opened through various financial institutions, including banks, can be used to acquire mutual funds. During the predicted time, all these elements will contribute to India Mutual Fund Market growth.
Future Market Scenario&nbsp;(FY2025 &ndash; FY2032)
Stream of flows, rise in retail investors' participation, and bullish market conditions have improved the assets for the small-cap mutual fund category to INR 2.43 lakh crore mark at the end of March 2024, marking an 83 percent rise compared to the previous year.&nbsp;&nbsp;
The surge in assets was complemented by a rise in the number of investors, with the number of folios adding an investor base of INR 8.1 million. These trends show that the future scenario of India mutual fund market is on the rise and will reach new boundaries.
Report Scope
&ldquo;India Mutual Fund Market Assessment, Opportunities and Forecast, FY2018-FY2032&rdquo;, is a comprehensive report made by Markets and data, providing in-depth analysis and qualitative and quantitative assessment of the current state of India mutual fund market, industry dynamics, and challenges. The report includes market size, segmental shares, growth trends, opportunities, and forecast between FY2024 and FY2031. Additionally, the report profiles the leading players in the industry mentioning their respective market share, business model, competitive intelligence, etc.
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Details
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Base Year of the Analysis
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FY2024
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Historical Period
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FY2018-FY2023
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Forecast Period
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FY2025-FY2032
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Segments Covered
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Scheme Type, Type, Distribution Channel, Investor Type
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Regions Covered
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North, South, East, West and Central
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Key Companies Profiled
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&nbsp;SBI Fund Management Limited, ICICI Prudential Asset Management Company Limited, HDFC Asset Management Company Limited, Nippon Life India Asset Management Limited, Kotak Mahindra Mutual Fund Asset Management Company Limited, Aditya Birla Sun Life AMC Limited (ABSLAMC), UTI Asset Management Company Limited, Axis Asset Management Company Limited, DSP Asset Managers Private Limited, Bandhan Asset Management Company Limited.
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Customization Scope
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15% free report customization with purchase
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Pricing and Purchase Options
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Avail the customized purchase options to fulfill your precise research needs
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Delivery Format
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PDF and Excel through email (subject to the license purchased)
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In the report,&nbsp;India mutual fund market&nbsp;has been segmented into the following categories:
<ul style="text-align: justify;">
<li>By Scheme Type
<ul>
<li>Debt-Oriented</li>
<li>Equity-Oriented</li>
<li>Money Market</li>
<li>ETFs</li>
<li>Others</li>
</ul>
</li>
<li>By Type
<ul>
<li>Open-Ended</li>
<li>Close-Ended</li>
</ul>
</li>
<li>By Distribution Channel
<ul>
<li>Banks</li>
<li>Financial Advisors</li>
<li>Direct Sellers</li>
<li>Others</li>
</ul>
</li>
<li>By Investor Type
<ul>
<li>Individual</li>
<li>Institutional</li>
</ul>
</li>
<li>By Region
<ul>
<li>North</li>
<li>South</li>
<li>East</li>
<li>West and Central</li>
</ul>
</li>
</ul>
Key Players Landscape and Outlook
India mutual fund market is highly competitive with key players such as SBI Funds Management Ltd., ICICI Prudential Asset Management Company Ltd., HDFC Asset Management Company Ltd., Nippon Life India Asset Management Limited, and many others. The market presents opportunities for growth during the forecast period, which makes the market competitive.
The growing digital intrusion, development of smart cities, and improvement in data speeds have led to an increase in retail Investors which in turn is poised to the growing mutual fund market. Investors and distributors are partnering with fintech startups to offer personalized services to investors dominating their technologies.
Key Players Operating in India Mutual Fund Market are:
<ul style="text-align: justify;">
<li>SBI Fund Management Limited</li>
<li>ICICI Prudential Asset Management Company Limited</li>
<li>HDFC Asset Management Company Limited</li>
<li>Nippon Life India Asset Management Limited</li>
<li>Kotak Mahindra Mutual Fund Asset Management Company Limited</li>
<li>Aditya Birla Sun Life AMC Limited (ABSLAMC)</li>
<li>UTI Asset Management Company Limited</li>
<li>Axis Asset Management Company Limited</li>
<li>DSP Asset Managers Private Limited</li>
<li>Bandhan Asset Management Company Limited</li>
</ul>
Markets and Data&rsquo;s reports answer the following questions:
<ul style="text-align: justify;">
<li>What is the current and future market size of the product/service in question globally or specific to different countries?</li>
<li>How are the markets divided into different product/service segments and the market size and growth of each segment?&nbsp;</li>
<li>What is the market potential of different product segments and their investment case?</li>
<li>How are the markets predicted to develop in the future and what factors will drive or inhibit growth?</li>
<li>What is the business environment and regulatory landscape specific to the product/service?</li>
</ul>
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