48% of equity MFs outperformed respective benchmarks in September 2024, PL Wealth study finds

Prabhudas Lilladher's wealth management arm, PL Wealth Management, recently released its mutual fund performance analysis for September 2024. According to the report, the assets under management (AUM) of equity mutual funds grew by 3.10 per cent sequentially to ₹26,43,291 crore in September 2024 from ₹25,64,069 crore in August 2024 (excluding sectoral/thematic funds).

The study analysed 287 open-ended equity diversified funds and found that 48 per cent or 137 funds outperformed their benchmarks during September 2024. The report also shed light on the performance of various mutual fund categories, indicating that a substantial number of schemes beat their benchmarks during this period.

Smallcap funds led the pack, with 75 per cent of the schemes beating their respective benchmarks. Midcap funds and flexi-cap funds followed, with 66 per cent and 51 per cent of their schemes outperforming, respectively. Within both multicap funds and focused funds, 50 per cent of schemes showed outperformance. Meanwhile, 48 per cent of schemes from the large & midcap fund category beat their benchmarks. As for equity-linked savings schemes, 44 per cent emerged as outperformers.

On the other hand, value contra dividend yield funds lagged, with only 19 per cent of funds outperforming the benchmark. Nifty 50 TRI, Nifty Midcap 150 TRI, and Nifty Small Cap 250 TRI posted monthly returns of 2.28 per cent, 1.8 per cent, and 1.4 per cent, respectively for September 2024.

When looking at the one-year performance ending September 2024, 55 per cent of the open-ended equity diversified funds outperformed their benchmarks. In comparison, 48 per cent of funds outperformed the previous year. For the same period, the Nifty 50 TRI, Nifty Midcap 150 TRI, and Nifty Small Cap 250 TRI recorded returns of 33.00 per cent, 48.21 per cent, and 51.49 per cent, respectively.

The report advised investors to maintain their systematic investment plans (SIPs) and stay focused on long-term goals. SIPs have delivered an average return exceeding 15 per cent per annum over the past three years for top-quartile equity funds.

September MF Data

Inflows into equity schemes declined by 10 per cent in September 2024, amounting to ₹34,419 crore, down from ₹38,239 crore in August, according to data released by the Association of Mutual Funds in India (AMFI). Despite the dip in equity scheme inflows, systematic investment plan (SIP) contributions hit a record high of ₹24,508.73 crore in September.

Smallcap schemes saw inflows of ₹3,070 crore in September, slightly lower than ₹3,209 crore in the previous month. In contrast, midcap schemes experienced a rise in inflows, increasing to ₹3,130 crore from ₹3,054 crore in August. Largecap funds, however, recorded a significant 54.6 per cent decline in inflows, dropping from ₹3,901 crore in August to ₹1,769 crore in September.

Categories like value mutual funds and multicap mutual funds witnessed increased inflows. Value mutual funds saw inflows rise from ₹1,728 crore in August to ₹1,964.35 crore in September, while multicap funds experienced a 41.77 per cent surge in inflows, reaching ₹3,508.8 crore.

The SIP contribution reached an all-time high of ₹24,508.73 crore in September 2024, compared to ₹23,547.34 crore in August. Additionally, the number of SIP accounts grew to 9.87 crore in September from 9.61 crore in August 2024.

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