Mid-tier MFs expand at rapid pace in FY21

The new decade may see some mid-sized mutual funds overtaking the current AUM chart toppers, given their fast-paced growth rate last year.

The fund houses that have grown at a scorching pace in FY21 include Mirae Asset MF (61.10 per cent), Axis Mutual Fund (42.01 per cent), Kotak Mahindra Mutual Fund (25.62 per cent) and IDFC Mutual Fund (17.53 per cent).

As of now, the top fund house in terms of asset under management (AUM) is SBI Mutual Fund, which has become India's first fund house to cross the Rs 5-lakh crore AUM milestone with assets of over Rs 5.04 lakh crore under its belt. Even with such a large base, its assets grew 35.04 per cent in FY21, leaving HDFC MF, having AUM of over Rs 4.15 lakh crore, far behind. HDFC MF's AUM grew at a slower pace of 12.38 per cent last financial year.

The MF industry AUM grew at 30 per cent in FY21 to Rs 32.17 lakh crore, from Rs 24.70 lakh crore in the previous year.

SBI MF, commenting on the new milestone, said, "The AAUM (average AUM) growth has been achieved on the back of robust increase in the SIP book and penetration in T30 and B30 locations. The fund house's SIP book has increased to Rs 1,382 crore from Rs 1,180 crore over

the last one year, recording a growth of 17 per cent."

SBI MF also enjoys inflows from government operated pension funds.

Ashwin Patni, headproducts alternatives, Axis Mutual Fund, said, "We have grown at fastest pace among the industry peers in the last three to five years, our AUM is set to grow as our product portfolios and fund performance are among the best in the industry."

ICICI Prudential MF came third last year with AUM of over Rs 4.05 lakh crore and grew at 15.58 per cent.

In a few years time it seems the churn at the top would be quicker than the previous decades, as a vast untapped market is captured by aggressive late starters. Last decade (2011-2020) belonged to Reliance, HDFC and ICICI Prudential MFs while UTI Mutual Fund and ICICI Prudential topped the AUM chart during the 2001-2010 period.

Even some at the middle and bottom of the AUM chart expanded at a furious pace last year. They included PPFAS MF (177.92 per cent), Edelweiss MF (91.44 per cent), Canara Robeco (57.57 per cent), Invesco MF (43.37 per cent), Motilal Oswal MF (29.09 per cent) and UTI MF (20.68 per cent).