SBI Mutual Fund Surpasses ₹10 Lakh Crore AUM, Leading the Industry

SBI Mutual Fund (SBI MF) has made headlines by becoming the first fund house in India to surpass the ₹10 lakh crore mark in assets under management (AUM), reaching ₹10.99 lakh crore in the September quarter, a notable increase from ₹9.88 lakh crore in June. This achievement places SBI MF ahead of its closest competitors, ICICI Mutual Fund and HDFC Mutual Fund, which have AUMs of ₹8.41 lakh crore and ₹7.47 lakh crore, respectively.

The robust growth can be attributed to strong inflows from new fund offers (NFOs) and a steady market rally, with the benchmark Sensex rising significantly during the same period.

Growth Drivers and Market Sentiment

The growth of SBI MF’s AUM reflects a broader trend in the mutual fund industry, with the total industry AUM rising to ₹66.22 lakh crore, a 12% increase from June’s ₹58.96 lakh crore. This surge is indicative of a healthy domestic investment environment, with investor confidence bolstered by a 67% increase in funds raised through NFOs, totaling ₹44,955 crore in the September quarter. Hitesh Thakkar, acting CEO of ITI Mutual Fund, noted that the understanding of market volatility as part of long-term wealth creation has encouraged more investments in mutual funds.

Dominance of Major Fund Houses

The mutual fund landscape is highly concentrated, with the top 16 fund houses controlling 90% of the industry’s AUM. Besides SBI MF, Franklin Templeton MF and Canara Robeco MF have also crossed the ₹1 lakh crore AUM mark. The popularity of mutual funds as investment vehicles has grown, especially in smaller cities, as evidenced by increasing participation through systematic investment plans (SIPs). However, the recent downturn in the stock market may pose challenges for new investors unfamiliar with market fluctuations.

Foreign Portfolio Investments Surge

In a related development, foreign portfolio investors (FPIs) have shown strong interest in the Indian primary market, investing a net $2.36 billion (approximately ₹19,842 crore) in October—the highest monthly investment since November 2021. This contrasts with their significant selling in the secondary market, where they sold equities worth $13.56 billion in October, the highest monthly outflow recorded. Despite this, domestic mutual funds have countered the selling pressure, with record net investments of ₹87,228 crore in October, significantly exceeding last year’s totals.

Summary of Key Figures

SBI MF AUM: ₹10.99 lakh crore

ICICI MF AUM: ₹8.41 lakh crore

HDFC MF AUM: ₹7.47 lakh crore

Total Industry AUM: ₹66.22 lakh crore

NFOs Raised: ₹44,955 crore in September quarter

FPIs in Primary Market: $2.36 billion in October

Domestic Mutual Funds Investment: ₹87,228 crore in October

Here’s a table summarizing the key points from the article

Key Point	Details
Why in News	SBI Mutual Fund became the first Indian fund house to surpass ₹10 lakh crore AUM, reaching ₹10.99 lakh crore in the September 2024 quarter.
SBI Mutual Fund AUM	Increased to ₹10.99 lakh crore in September 2024 from ₹9.88 lakh crore in June 2024, marking a significant milestone in the industry.
Market Rally Impact	Benchmark Sensex rose 7% from 79,033 points in June to 84,300 points in September, supporting the increase in AUM across the mutual fund industry.
Industry AUM Growth	Total industry AUM rose 12%, reaching ₹66.22 lakh crore in September 2024, up from ₹58.96 lakh crore in June 2024, driven by strong NFO collections and investor interest.
NFO Growth	New fund offers (NFOs) raised ₹44,955 crore in September, a 67% increase from ₹26,899 crore in June, with 60 NFOs launched compared to 35 in the previous quarter.
Top Competitors	ICICI MF and HDFC MF held the second and third positions with AUMs of ₹8.41 lakh crore and ₹7.59 lakh crore, respectively.
Concentration of AUM	The top 16 mutual funds hold 90% of the industry’s AUM, amounting to a cumulative ₹59.51 lakh crore.
Domestic vs. FPI Investment	Domestic mutual funds invested a record ₹87,228 crore in October 2024, countering heavy FPI outflows in the secondary market, where FPIs sold equities worth $13.56 billion due to attractive opportunities in other markets like China.
Investor Sentiment	Increased investor confidence, especially in smaller cities, boosted by SIPs and NFOs. However, market volatility remains a concern for new investors unfamiliar with market fluctuations.