Corporate share in MF AUM sinks below 40% since FY10, shows data

The share of corporates in the total assets under management (AUM) of mutual funds (MFs) dropped to below 40 per cent for the first time since 2009-10 (FY10).

Data sourced from the Centre for Monitoring Indian Economy by Fisdom Research reveals that companies accounted for 39.7 per cent of total MF AUM at the end of December 2022, against 41.2 per cent at the end of March 2022.

The decline in corporate share in AUM last year was a result of two factors: redemption by companies amid decline in excess liquidity due to interest-rate hikes and rise in inflows from retail investors and high-networth individuals (HNIs).

Data shows that the HNI share in total AUM rose from 32.7 per cent in March 2022 to 33.7 per cent in December 2022, while that of retail investor increased from 24.6 per cent to 25.4 per cent.

Debt MFs, which receive the bulk of corporate money, have seen sustained outflows for over a year. As a result, debt MF AUM declined 9 per cent in 2022-23 to Rs 11.8 trillion.

Corporates had over 51 per cent share in the MF industry’s AUM in FY10. The share declined over time with increased retail and HNI participation.

Data shows that retail and HNI investors had a 45 per cent share in FY10. This rose to 59 per cent by December 2022. The industry considers investors with a ticket size of over Rs 2 lakh as HNIs.