India’s SIP Book Crosses Rs 25,000 Crore Mark: Key Takeaway For Investors

Indian investors’ growing tilt towards SIPs (Systematic Investment Plans) as a favoured investment option delivered a new milestone last month. The October 2024 data released by the Association of Mutual Funds of India (Amfi) shows that SIPs crossed over Rs 25,000 crore in monthly investments for the first time. Last month saw SIP contributions reach a record Rs 25,322 crore showing the resilience of retail investors during a period when markets were on a downward slope.

Says Sarvjeet Singh Virk, Co-founder and MD of Shoonya by Finvasia, “The record-breaking SIP inflows in October 2024 mark a significant milestone. This surge in SIP contributions not only underscores the resilience of retail investors but also reinforces the increasing maturity of India’s investment culture.”

He further adds that despite market fluctuations, the sustained momentum of SIPs reflects a deeper understanding among Indian investors of the power of compounding and systematic investing.

According to Virk, the spread of investments across large-cap, mid-cap, and multi-cap funds shows that investors are leaning to diversify wisely. “For investors, the key takeaway is to remain focused on consistent SIP allocations, particularly in multi-cap funds, which provide the flexibility to adapt to changing market conditions. In these uncertain times, staying invested with a long-term view will continue to deliver the most sustainable growth,” he advises.

The numbers back up this positive trend.

SIPs Reach New Highs!

Data from Amfi released on November 11 shows that the SIP book surged from Rs 24,509 crore in September to over Rs 25,322 crore in October. The number of SIP accounts also reached a record high of 10.12 crore, a significant rise from 9,87 crore the previous month.

Even with a shaky market, the Sensex and Nifty were down 5.77 per cent and 6.22 per cent, respectively last month. However, investors remained bullish on the Indian markets, with a net 24.19 lakh SIP accounts added during the month.

Says Venkat Chalasani, chief executive of Amfi, “The continued surge in SIP accounts demonstrates the growing preference for disciplined investing among Indian investors. These milestones reinforce our commitment to making mutual funds the cornerstone of wealth creation for every Indian investor, as we continue to build a more financially inclusive nation.”

However, October’s high SIP inflow was not without some losses as the SIP asset under management, which had peaked at 13.81 lakh crore in September, came down to Rs 13.30 lakh core by the end of October. The investor sentiments remained unwavering, where open-ended equity mutual fund inflows grew by 21.69 per cent on a month-to-month basis, reaching Rs 41,887 crore across the equity fund segment last month.

SIP investments have seen an upward swing for the last few years, since 2016-17. Monthly SIP inflows reached Rs 3,122 crore and Rs 8,500 crore during April 2016 and March 2020 respectively. SIP investments further accelerated post-Covid pandemic attaining a high of Rs 10,000 crore for the first time in September 2021. It hit the Rs 20,000 crore level for the first time in April 2024.

The SIP performance over the year shows that its story is only getting started, with the latest record suggesting that India’s investment landscape is moving towards the financialisation of Indian households.