Key mutual fund trends observed in June 2025

MUTUAL FUND BRIEFING – JUNE 2025

June 2025 saw overall mutual fund AUM expand from ₹72.2 Trillion to ₹74.4 Trillion; supported by MTM gains. Active debt funds saw net outflows of ₹(1,711) Crore, despite being the quarter end. Active equity funds saw inflows of ₹23,587 Crore, showing a small bounce. However, action in the hybrid mutual funds category really stood out.

Hybrid funds saw best net inflows of ₹23,429 Crore, while passive fund inflows were tepid at ₹3,997 Crore. In equity funds, the demand thrust shifted from sectoral and thematic funds to flexi-cap, small cap, and mid-cap funds. Gross SIP flows in June 2025 scaled a new high of ₹27,269 Crore, while SIP stoppage ratio stabilized at around 77.9%.

KEY MUTUAL FUND TRENDS – SEGMENT LEVEL (JUNE 2025)

Here are mutual fund segment level trends for June 2025.

• Average assets under management (AAUM) of all mutual fund schemes surged on MOM basis from ₹72.18 Trillion to ₹74.79 Trillion in June 2025. The AAUM is now at a new all-time high, with average AUM 21.9% higher yoy.
• Last couple of years saw steady shift in AUM mix from active debt to active equity; but intensity has reduced. The share of active equity funds in AUM for June 2025 was up 30 bps from 59.8% to 60.1% MOM; although AUM share is up just 50 bps yoy.
• Passive fund share was 20 bps lower MOM at 12.5% in June 2025 and 30 bps lower on yoy basis. The share of active debt funds was 10 bps lower MOM at 14.9% in June 2025 while share is down 20 bps yoy. Liquid / money market funds share reduced 10 bps MOM to 12.5% in June 2025, but flat on yoy basis.
• The AUM shares of individuals and institutions had approximately stabilized, although the equity rally saw individual share rise in June 2025. Between June 2024 and June 2025, the share of individual investors in overall MF AUM is down 40 bps at 60.7%. Individual share peaked at 61.9% in September 2024, and has stayed below that.
• How individual investors allocated across MF categories? As of June 2025, individual investors have a share of 34% in active debt funds but just 11% in short term money market schemes; a whopping 88% of equity fund assets, but 13% of passive assets.
• What about an individual investor’s allocation basket? As of June 2025, individual investors have 87% MF portfolio in active equity schemes and 8% in active debt funds. Liquid funds at 2% and ETFs at 3% are small. Institutions and corporates have 28% of corpus in liquid funds, 28% in passives, 25% in active debt funds and 19% equity funds.

As of June 2025, mutual fund AAUM grew 21.9% yoy. Assets of individual investors in this period grew 21.1% while AUM of institutional investors grew 23.2%.

KEY MUTUAL FUND TRENDS – FOLIOS AND TICKET SIZES (JUNE 2025)

Folios are investor accounts unique to an AMC; an approximation of retail intensity.

• There were 24.13 Crore folios as of the close of June 2025 of which retail investors accounted for nearly 91.7%. In addition, HNIs accounted for 7.8% of folios while institutions accounted for balance 0.5%. In case of active debt funds, retail investors account for 71.8% of folios, while HNI investors account for 26.0%. HNIs also have high share of folios of liquid funds (24.2%) and hybrid funds also at (24.2%).
• Between March 2009 and September 2014, mutual fund folios contracted from 4.76 Crore to 3.95 Crore. However, between September 2014 and June 2025, the number of mutual fund folios have jumped from 3.95 Crore to 24.13 Crore. That is a jump of 511% in folios. This is after elimination of 1.43 Crore dormant folios this year.
• Let us look at average ticket size for equity and debt products. For equity funds (predominantly a retail product), the average ticket size is down -6% yoy at ₹1.80 Lakhs. For debt funds, average ticket size is up 10% yoy at ₹17.57 Lakhs. The net AUM of Indian mutual funds at ₹74.41 Trillion is spread across 24.13 Crore folios, giving a per folio ticket size of ₹3.08 Lakhs; an improvement after dormant folio clean-up.
• Contrary to popular perception, retail investors are not myopic in their approach to equity funds. As of June 2025, retail investors hold 54.9% of equity fund assets and 44.3% of non-equity assets for over 2 years. Retail investors have held 73.6% of equity funds for at least 1 year.

While retail investors have an average account size of ₹78,177, the HNI investors have an average account size of ͅ₹9,46,393.

KEY MUTUAL FUND TRENDS – GEOGRAPHICAL MIX (JUNE 2025)

How are cities and towns contributing to the mutual fund growth story?

• The mutual fund market is divided into T30 (top-30) cities and B30 (cities beyond top-30). If you compare June 2025 with May 2025, T30 assets were up 3.55% at ₹60.99 Trillion. Total assets of B30 centres grew 3.92% to ₹13.80 Trillion. If we only look at the share of individuals; in June 2025, B30 cities accounted for 27.39% of individual assets while share of individuals in T-30 cities stood at 72.61%. Institutions have a T-30 bias.
• Despite the Direct route available since 2013, only 47% of overall assets came through the Direct route, with 27% of retail investors and 28% of HNIs investors. Here there is an improvement.

Clearly, direct investing is yet to pick up in a big way among individual investors, although individual investors are starting to see the merits of direct investing.