Mar-25 Mutual fund AUM recovers to ₹65.74 Trillion

15 Apr 2025 , 03:46 PM

EQUITY MARKET RECOVERY OFFSETS DEBT FUND REDEMPTIONS

March 2025 saw heavy outflows from debt funds to the tune of ₹(2,02,663) Crore. However, it was not just the flows into equity funds, but the recovery in the markets that helped the overall AUM of mutual funds recovery by 1.88% over February. In fact, equity fund flows were almost at a yearly low of ₹25,082 Crore. However, the good news is that while NFO flows continued to be subdued, the gross SIP flows were still robust in March 2025. Overall outflows from mutual funds were in March 2025 were steep at ₹1,64,435 Crore.

Interestingly, hybrid funds saw outflows after a very long time in March 2025. Hybrid allocation funds (including solution funds) saw net outflows of ₹(705) Crore in March 2025, although this was predominantly led by arbitrage funds and equity savings funds. Multi-asset allocation funds continued to see robust inflows. The passive funds saw revival of interest building up in an uncertain month with inflows of ₹14,149 Crore in Mar-25. Let us take a quick look at the SIP and NFO story for March 2025.

SIPS MARGINALLY LOWER, NFOS STRUGGLE

Gross SIP inflows in March 2025 was the lowest in the last 3 months at ₹25,926 crore, has been progressively lower; compared to ₹25,999 Crore in February, ₹26,400 Crore in January, and ₹26,459 Crore in December 2024. The real challenge, in the last couple of months, was not the gross SIP figure, but the SIP stoppage ratio at above 100%. The NFO story remained subdued in March 2025 collecting just ₹4,085 Crore across 30 NFOs. It was the index funds that dominated the NFO story, accounting for half of the monthly flows. Apart from low duration funds, NFO inflows into other categories was relatively tepid in March 2025.

MAR-25 SAW QUARTERLY BLUES SPIKE DEBT FUND REDEMPTIONS

Here is a quick look at monthly flows across fund categories in last 13 months.

Month	Debt Fund Flows (₹ Crore)	Equity Fund Flows (₹ Crore)	Hybrid Fund Flows (₹ Crore)	Passive Fund Flows (₹ Crore)	Total MF Flows (₹ Crore)
Mar-24	(1,98,299)	22,633	5,791	12,793	(1,59,387)
Apr-24	1,89,891	18,917	20,110	11,505	2,39,233
May-24	42,295	34,697	18,456	15,665	1,11,103
Jun-24	(1,07,358)	40,608	9,039	14,602	(43,109)
Jul-24	1,19,588	37,113	17,663	14,778	1,89,141
Aug-24	45,169	38,239	10,233	14,599	1,08,123
Sep-24	(1,13,834)	34,419	5,366	3,254	(71,114)
Oct-24	1,57,402	41,887	17,189	23,428	2,39,907
Nov-24	12,916	35,944	4,443	7,061	60,295
Dec-24	(1,27,153)	41,156	4,703	784	(80,355)
Jan-25	1,28,653	39,688	9,011	10,255	1,87,551
Feb-25	(6,526)	29,303	7,050	10,249	40,063
Mar-25	(2,02,663)	25,082	(705)	14,149	(1,64,435)

Data Source: AMFI (negative figures in brackets)

Monthly redemptions from debt funds in March 2025 were the highest in the last one year at ₹(2,02,663) Crore. Equity fund inflows were at a 11-month low of ₹25,082 Crore; with inflows falling below ₹30,000 Crore for the second month in a row. Hybrid funds saw outflows for the first time in last one year, while passive funds saved the day with positive inflows of ₹14,149 Crore. The passive story was driven by index ETFs and index funds.

HOW THE ₹65.74 TRILLION NET AUM ADDED UP?

As of the close of March 2025, mutual funds reported 1.88% sequentially higher AUM at ₹65.74 Trillion. Here is the AUM mix for the last 13 months.

Month	Debt AUM (₹ Trillion)	Equity AUM (₹ Trillion)	Alternate AUM (₹ Trillion)	Total AUM (₹ Trillion)
Mar-24	12.62	23.49	17.02	53.40
Apr-24	14.59	24.74	17.66	57.26
May-24	15.12	25.40	18.13	58.91
Jun-24	14.13	27.68	19.08	61.16
Jul-24	15.44	29.34	19.92	64.97
Aug-24	16.00	30.09	20.35	66.70
Sep-24	14.97	31.10	20.75	67.09
Oct-24	16.64	29.89	20.46	67.26
Nov-24	16.86	30.36	20.60	68.08
Dec-24	15.67	30.58	20.41	66.93
Jan-25	17.06	29.47	20.46	67.25
Feb-25	17.08	27.40	19.79	64.53
Mar-25	15.21	29.45	20.82	65.74

Data Source AMFI

For March 2025, active debt fund AUM was sharply lower at ₹15.21 Trillion; due to negative flows in the quarter-end. Debt fund AUM is up 20.5% on yoy basis. The AUM of equity funds also jumped to ₹29.45 Trillion in March 2025 from ₹27.40 Trillion last month. It is still way below its September 2024 peak. Equity fund AUM is 25.4% higher yoy. Alternate AUM has improved MOM, thanks to passive funds; and it is 22.3% higher yoy. Here is a look at the AUM shares of various categories of funds as of March 2025.

Month	Active Debt Funds	Active Equity Funds	Hybrid Funds	Passive Funds	Solution Funds	Close-ended Funds
Oct-24	24.74%	44.45%	12.98%	16.67%	0.78%	0.40%
Nov-24	24.76%	44.59%	12.88%	16.60%	0.77%	0.39%
Dec-24	23.42%	45.68%	13.10%	16.61%	0.79%	0.40%
Jan-25	25.37%	43.82%	13.02%	16.64%	0.76%	0.40%
Feb-25	26.47%	42.45%	13.20%	16.71%	0.75%	0.41%
Mar-25	23.13%	44.80%	13.44%	17.45%	0.78%	0.41%

If you take a 5-month perspective (March 2025 over October 2024), active debt funds have lost AUM share, while equity funds, hybrid funds, and passive funds have gained marginal AUM share. However, the AUM share of active equity funds is still lower than the peak level of September 2024 by 156 basis points.

ACTIVE DEBT FUNDS: WEEKEND WOES HIT DEBT FUND FLOWS

Debt funds saw net outflows of ₹(2,02,663) Crore in March 2025. All debt fund categories saw outflows in the month. Big drivers of debt fund outflows were Liquid Funds ₹(1,33,034) Crore, Overnight Funds (30,016) Crore, Money Market Funds (21,301) Crore, and Ultra Short Duration Funds ₹(9,647) Crore. The debt fund outflows continue to be concentrated at the short end of yield curve. That is not too surprising the advance tax pressures that normally build up around the end of every quarter.

ACTIVE EQUITY FUNDS: ALPHA AND DIVERSIFICATION STILL IN DEMAND

In March 2025, equity funds saw subdued net inflows of ₹25,082 Crore. Big drivers of inflows into equity funds were Multi-Cap / Flexi-Cap Funds ₹8,368 Crore, Small Cap Funds ₹4,092 Crore, Mid-Cap Funds ₹3,439 Crore, Large & Mid-Cap funds ₹2,718 Crore, Large Cap Funds ₹2,479 Crore, and Value Funds ₹1,553 Crore. None of the equity fund categories saw negative flows in March 2025; but sectoral funds seemed to be out of demand.

HYBRID OUTFLOWS AND PASSIVE INFLOWS IN MARCH 2025

After a very long time, hybrid funds, overall, saw outflows of ₹(705) Crore in March 2025. In the hybrid category, net inflows were dominated by Multi-Asset Allocation Funds at ₹1,670 Crore while Arbitrage Funds saw net outflows of ₹(2,855) Crore; largely due to pressure from treasury redemptions by corporates.

In the passive category; inflows were dominated by index ETFs ₹10,962 Crore followed by Index Funds at ₹3,501 Crore. Gold fund flows tapered at higher levels. The passive category flows in March 2025 were sharply higher than in February 2025.

March 2025 saw the net AUM of mutual funds go up, despite heavy debt fund redemptions. This can be attributed to the revival in the equity markets. However, one does sense that the enthusiasm for passive funds appears to be coming back!