Agencies
Contributions to mutual fund schemes through systematic investment plans or SIPs remain unfazed from the market volatility in
2022 with inflow growing to Rs 1.5 lakh crore in 2022, a surge of 31 per cent from a year earlier, due to higher retail
participation.
In comparison, an inflow of Rs 1.14 lakh crore through the route was registered in 2021 and Rs 97,000 crore in 2020, data
with the Association of Mutual Funds in India (AMFI) showed.
Going ahead, SIP numbers are expected to continue to remain strong in 2023 as investors are increasingly appreciating the
importance of regular investing through the route, Kaustubh Belapurkar, director – manager research at Morningstar Investment
Adviser India, said.
“As newer investors come to the fore, the SIP numbers will continue to increase.
“While SIP numbers will remain strong, lump sum flows will be dependent on market levels and volatility, we have seen
investors book profits when markets run up and re-allocate to equities when markets are lower,” he added.
Priti Rathi Gupta, Founder and MD at LXME, said the trend of investing through SIP will gain even more momentum in this
year in order to enable the financial inclusion of investments by people beyond traditional instruments which will further
contribute towards the increase in the assets under management (AUM).
SIP is an investment methodology offered by mutual funds wherein an individual saver can invest a fixed amount in a
chosen scheme periodically at fixed intervals – say once a month, instead of making a lump sum investment.
The SIP instalment amount can be as small as Rs 500 per month.
The SIP book has grown consistently from Rs 11,305 crore in December 2021 to an all-time high of Rs 13,573 crore in
December 2022.
This was also the third time in a row, when monthly SIP contributions touched over Rs 13,000-crore.
During the calendar year, SIP inflows averaged more than Rs 12,400 crore per month, helping investors to stay in the stock
market and benefit from rupee cost averaging.
The steady inflow suggests resilience in domestic inflows, which have been a strong counterbalance to FPIs (Foreign
Portfolio Investors) selling.
“The consistent inflow in 2022 is primarily because of higher retail participation through the SIP route which has become a
strong habit for them.
“This happened despite the fluctuation in the broad market. “The inflow from new retail investors from Tier 2 towns
onwards has also built up in the last 5 years as mutual funds have become more accessible through the digital channels,”
Swapnil Bhaskar, Head of Strategy at Niyo (neo-bank for millennials), said.
