In a remarkable feat, a staggering 40.32 lakh individuals opted for systematic investment plans (SIPs) in December, setting a new record amid the sustained bullish market trends. This marks a 31% upswing compared to November and a significant 73.5% surge from the previous year.
The Association of Mutual Funds in India (AMFI) reports a consistent monthly addition of 30 lakh new SIP registrations since July, propelling the SIP registrations for FY24 beyond the combined figures of FY23 and FY22. The period between April and December 2023 witnessed 2.85 crore new registrations, surpassing the totals for entire FY23 and FY22.
Market analysts attribute this surge to investors’ reinforced confidence in India’s macroeconomic fundamentals. Additionally, optimism about potential interest rate cuts this year and the recent BJP-led NDA victory in state elections have further bolstered faith in the government’s economic policies. Analysts suggest that a return of the Modi-led NDA regime could provide a conducive environment for India to achieve its $5-trillion economic goal.
On the flip side, December saw an increase in discontinued SIP accounts, with 20.8 lakh investors withdrawing funds. However, the growth in SIP registrations reflects a broader trend of new investors adopting disciplined investment approaches, especially through mutual funds. Increased inflows through SIPs indicate investors’ trust in this systematic investment strategy.
In December, open-ended scheme assets reached Rs 50.80 trillion, showcasing confidence in retail investors. SIP inflows totaled Rs 17,610 crore, with Small Cap funds gaining Rs 3,858 crore, while midcap fund inflows experienced a 48% drop. Large Cap funds faced Rs 281 crore net outflows.
Analysts emphasize that the rising trend in SIP registrations signifies a growing preference for disciplined investment practices, underscoring investors’ trust in this approach even amidst all-time market highs.
