The year 2024 has been spectacular for the mutual fund industry. Data by the Association of Mutual Funds in India (Amfi) shows that the total number of accounts as of December 31, 2024 stood at 225 million. On the other hand, as many as 239 new fund offers (NFOs) attracted investors to the mutual funds market in 2024.
These 239 NFOs collectively raised a whopping Rs 1,18,519 crore, according to a report by mutual fund distributor Germinate Investor Services. On a year-on-year (y-o-y) basis, the number of NFOs launched in 2024 increased by 13 per cent compared to 212 in 2023. The report also said that the NFO landscape grew from just 81 launches in 2020 to 239 launches in 2024, showcasing a strong growth trajectory.
The funds raised through NFOs surged by 85 per cent compared to the previous year, showcasing heightened investor confidence.
In terms of collections, July 2024 saw the highest inflow at Rs 16,500 crore. The high amount of collections were driven by market optimism and aggressive fund marketing. In terms of the number of launches, December saw the highest number launches, with 34 NFOs raising Rs 13,852 crore.
ndex funds emerged as the most popular type of scheme, with 90 schemes launched in 2024, followed by 53 sectoral and thematic schemes, and 45 exchange-traded funds (ETFs).
Sectoral and thematic funds also gained in popularity in 2024, as 53 NFOs raised Rs 79,109 crore. Themes, such as manufacturing, energy, business cycles, technology and smart beta funds became popular in 2024. The HDFC Manufacturing Fund recorded the highest inflows in 2024 with collections reaching Rs 12,500 crore in April 2024.
Mutual Funds Industry Outlook For 2025
The mutual fund distributor has projected that the mutual fund industry is likely to see a recalibration in 2024. The report claimed that investors might not make extraordinary gains in 2025 and may need to focus on maintaining liquidity while achieving reasonable returns.
“The mutual fund industry is likely to face a recalibration in 2025 after the strong gains of recent years. While extraordinary returns may not sustain, the focus will shift to ensuring stability, maintaining liquidity, and achieving reasonable returns in line with market trends,” the mutual fund distributor said.
Germinate also urged investors to deploy strategies which align with changing market dynamics to ensure steady returns through uncertainty.
“Investors must adapt to a more balanced approach, safeguarding capital while managing expectations. This calls for strategies that align with changing market dynamics and ensure a steady performance even in uncertain times,” Germinate said.
