AMFI chief sees equity fund inflow inching towards Rs 100 lakh crore target

While the current data of the Association of Mutual Funds in India shows that equity mutual fund inflow dipped in May 2023 after witnessing a net inflow of Rs 2,906 crore in April 2023 compared to Rs 5,275 crore in April 2023, AMFI Chief Executive NS Venkatesh firmly believes AMFI is inching towards the target of Rs 100 lakh crore AUM by 2028 - 2030.

We have watched how the economy grows, and our thought process is that by at least around 2028 to 2030, we should be able to see the 100 lakh crore AUM number. On the primary reason behind the lowest inflow since November 2022 when it was Rs 2,224 crore, Venkatesh said: Compared to the last month particularly it has dropped for the simple reason, that is, there is a profit booking which happened so people are booking their profits, particularly from the large-cap funds. The mid-caps and small-caps are doing reasonably well, he said. Slowly, attraction has shifted to mid-caps and small-caps at this particular point mainly because the valuations had undergone a steep correction of around 60 - 65 percent. Now it looks very attractive, so people are coming into these small-cap funds to participate in the small-cap stocks rally so that you can see the difference happening. But I agree that there has been a little bit of a drop in the equity net flows into the equity mutual funds mainly because of the profit booking, which is a significant reason behind it. In May, the small-cap inflow did well and registered a fund inflow of Rs 3,283 crore against Rs 2,182 in April. Inflows of Rs. 1,196 crore and Rs. 289 crore inflows from the mid-cap and dividend yield funds.

In May, SIP inflows rose to a new high of 14,749 crore compared to a previous record of 13,728 crore in April.

AMFI being a part of an ethics committee that would set up internal mechanisms within fund houses to catch frauds like front-running and insider trading, Venkatesh said. We should have an ethics committee, which is the right thought process for when the industry grows, she said. You need to have more self-regulation in place, and towards that independently, the Ethics Committee will play a part we are discussing internally amongst the members as well as our board. Hopefully, in a month to 45 days, we should come out with a concrete proposal on how the ethics committee will be formed, who will be the constituent of the ethics committee, including maybe independent personnel who could make to be part of that ethics committee and then that ethics committee will give out the broad guidelines on how various best practice guidelines should be followed. The ethics committee will take action if any specific AMC is not doing it in the right way. That is how it is at this particular point of time, but it is a working process, he said.