The assets under management (AUM) of funds linked to the systematic investment plans (SIP) reached a record of Rs 4.7 lakh crore at the end of May 2021 following a consistent inflow and capital appreciation amid a sustained stock market rally. The SIP equity funds have delivered 26-56% returns over the past year thereby resulting in an expansion of 1.7 times in their aggregate AUM during the period.
The SIP linked schemes contributed 14.1% to the AUM of the mutual fund industry in May compared with the long-term average of 10.2%. They attracted a cumulative inflow of Rs 96,995 crore over the past 12 months.
A consistent inflow into the SIP schemes has played a crucial role in offsetting the volatility in the flow from foreign portfolio investors (FPIs). The SIP book received a monthly inflow of more than Rs 8,000 crore in five out of the past six months. According to industry experts, nearly 90% of this went to the equity funds. It means cumulative inflow from SIP driven funds into equities would be around Rs 38,000 crore in the past six months, which is nearly 91% of the FPI inflow in the same duration.
Over the past five years, the SIP AUM has grown by 30% annually, twice as fast as the growth in the industry AUM. The average portfolio value of an SIP investor rose to Rs 1.2 lakh per account compared with Rs 86,186 a year ago. The total tally of outstanding SIP accounts reached 3.9 crore in May. The average ticket size dropped to Rs 2,270 from Rs 3,034 two year ago reflecting rising participation from small investors driven by digital platforms to open new accounts.