Half of India’s Mutual Fund Investments Come From 5 Cities: Report

New Delhi [India], March 5 (ANI): Half of India’s mutual fund investment comes from the top five cities of India, says a report by asset management firm Abakkus.

According to the report, Mumbai, Delhi, Bengaluru, Pune, and Kolkata are the top five cities that contribute about fifty per cent of mutual fund investments in India.

The data released by the report adds that with about 27.29 per cent of total Assets Under Management (AUM), Mumbai comes in first place. The city’s total AUM stands at Rs 18.92 lakh crores.

National Capital Delhi stands second with 12.25 per cent of total AUM at Rs 8.5 lakh crore. Bengaluru stands third with a total AUM of 3.8 lakh crore or 5.48 per cent of the total investment in mutual funds.

Pune’s share stands at 2.7 lakh crore, or 3.9 per cent, and Kolkata is at the fifth rank on the list with Rs 2.4 lakh crore of investment in mutual funds, or 3.48 per cent of the total AUM, according to the report.

The Indian mutual fund industry achieved new heights in 2024 as it surpassed Rs 68 lakh crore in assets under management (AUM).

According to the AMFI data, the mutual fund industry’s AUM crossed Rs 68 lakh crore in 2024 by November 2024. In December 2023, the AUM was Rs 50.78 lakh crore, which means the AUM has grown by 34 per cent in this period.

The maximum growth came in the equity mutual funds–the equity mutual fund AUM stood at Rs 30.5 lakh crore–45 per cent of the total AUM.

A decade ago, the Indian equity mutual fund AUM was a mere Rs 1.9 lakh crore. In August 2023, the AUM crossed Rs 30 lakh crore for the first time. This suggests that the AUM has more than doubled in less than 18 months.

The Systematic Investment Plan (SIP) has achieved remarkable milestones in 2024. The SIP AUM reached an all-time high of Rs 13.54 lakh crore in November 2024.

The SIP accounts also hit a record high, at 10.23 crore in November 2024, up from 10.12 crore in September 2024.

Monthly SIP inflows witnessed an impressive 48 per cent growth year-over-year, surging from Rs 17,073 crore in November 2023 to Rs 25,320 crore in November 2024.

SIPs have become a cornerstone of wealth creation for Indian retail investors. But with markets going down, equity mutual funds have lost up to 20 per cent over the last nine months.

However, on average, historically, MFs have given a 12-14 per cent return over a period of 5-10 years. (ANI)

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Mindteck Announces Resignation of Anand Balakrishnan, Managing Director and CEO

BusinessWire India

Bengaluru (Karnataka) [India], March 5: Mindteck (India) Limited (BSE: 517344 and NSE: MINDTECK), the global engineering and technology solutions company with niche knowledge and expertise in the storage, medical device, semiconductor and analytical instrument industries, today announced that Anand Balakrishnan has tendered his resignation as Managing Director and Chief Executive Officer, effective May 31, 2025. He will continue to serve in his role for the next three months, as per the terms of his contract, ensuring a smooth transition.

Anand Balakrishnan has been at the helm of the Company for the past five years, driving a successful transformation that has resulted in sustainable growth, and improved liquidity. Reflecting on his tenure, Anand Balakrishnan stated, “The journey over the past five years has been both rewarding and challenging. With Mindteck now well-positioned for continued success, I believe this is the right time for a leadership transition. My decision to step down is based on personal reasons, and I look forward to focusing on these important aspects at this stage in my life. I extend my deepest thanks to our employees, customers, partners, shareholders and members of the Board for their unwavering support throughout this period.”

Yusuf Lanewala, Chairman of the Company commented, “While we regret to see Anand step down, we fully respect his decision to focus on personal priorities. Over the past five years, Anand has been instrumental in positioning Mindteck for long-term success. On behalf of the Board, I would like to thank him for his significant contributions, and we wish him all the best in his future endeavours.”

The Board of Directors has accepted the resignation of Anand Balakrishnan, and the Nomination and Remuneration Committee will select a suitable candidate.
For more information, contact gnana.murthy@mindteck.com 

India’s Services Sector Grows Faster in February Amid Rising Demand

New Delhi [India], March 5 (ANI): The HSBC India Services PMI rose to 59.0 in February, up from January’s 26-month low of 56.5, indicating a sharp expansion in business activity.

India’s services sector expanded at a stronger pace in February, driven by rising domestic and international demand, leading to increased new orders, higher employment, and robust business activity. However, while cost pressures persisted, inflation rates eased to a four-month low, according to HSBC India Services PMI.

This growth was well above the long-run average, supported by higher productivity, strong demand, and an increase in new business orders.
New orders in February grew at a faster pace as compared to January, with improved international demand. Service providers reported stronger exports from clients across Africa, Asia, Europe, the Americas, and the Middle East, meeting the rising demand and easing capacity pressures.
Services firms continued hiring at one of the fastest rates since data collection began in December 2005. Both full-time and part-time staff were recruited, showing the sector’s confidence in sustained growth.

Despite rising hiring costs and higher expenses on food, materials, and packaging, overall cost inflation dropped to a four-month low, aligning with historical trends.
The rate of increase in selling prices for goods and services was the highest in three months, as businesses passed additional costs onto customers.
The HSBC India Composite Output Index, which measures both manufacturing and services, rose from 57.7 in January to 58.8 in February, reflecting stronger private sector growth. However, while the service sector drove this acceleration, manufacturing growth slowed down.

The private sector also saw a faster rise in employment, with payroll expansion remaining strong compared to the previous month’s record growth.
However, backlogs of work continued to rise, suggesting that despite hiring efforts, demand remained higher than companies’ processing capacities. New export business index, played a major role in driving output growth for India’s services sector.”

Pranjul Bhandari, Chief India Economist at HSBC, said, “India’s services business activity index rose to 59.0 in February 2025, up considerably from January’s 26-month low of 56.5. Global demand, which grew at its fastest pace in six months according to the new export business index, played a major role in driving output growth for India’s services sector.”

Bhandari added, “Meanwhile, job creation and charge inflation remained strong during February. Looking ahead, business sentiment remains broadly positive, but did slightly slip last month to its lowest level since August 2024.”

Advertising, improved customer relations, and efficiency gains kept business confidence broadly positive, with about one-quarter of firms expecting growth over the next year. However, sentiment dipped to a six-month low due to concerns over cost pressures and future demand.

Among the four key service industry segments, Consumer Services saw the highest cost pressures, while Transport, Information & Communication firms recorded the strongest rise in selling prices. (ANI)

IMF cautioned of systemic risks in India’s NBFC sector due to high exposure to power and infrastructure sector

New Delhi [India], March 4 (ANI): The International Monetary Fund (IMF) has raised concerns about potential financial instability in India due to the concentrated exposure of Non-Banking Financial Companies (NBFCs) to the power and infrastructure sector.

The report highlights that NBFCs are deeply interconnected with banks, corporate bond markets, and mutual funds, which could amplify systemic stress if vulnerabilities emerge.

The IMF report specifically warns about the high exposure of NBFCs to the power sector, which continues to face structural challenges.

Concentrated lending to this sector increases the risk of financial instability, as any distress in power and infrastructure projects could trigger broader stress across banks, bond markets, and mutual funds.

Furthermore, the co-lending model, where banks partner with NBFCs to extend credit to priority sectors, further intertwines financial institutions, increasing systemic risk.

The IMF suggests closer monitoring of NBFCs’ lending patterns and improved risk management frameworks to prevent financial disruptions.

The report raises concern that while NBFCs function similarly to banks in many ways, key differences remain. Unlike banks, NBFCs cannot accept demand deposits, and their deposits are not insured.

They also do not have access to the Reserve Bank of India’s (RBI) liquidity facilities or payment systems.

The IMF recommends strengthening liquidity regulations for NBFCs, particularly those with significant infrastructure exposure.

Additionally, India’s corporate bond market remains underdeveloped, making NBFCs heavily reliant on domestic institutions like banks and mutual funds for financing. This interconnectedness has led to past liquidity crises, with major redemptions in the mutual fund industry linked to corporate bond market distress.

Despite these challenges, India has made significant progress in financial inclusion. The IMF notes that nearly 80 per cent of adults have financial accounts, supported by extensive banking networks and the growth of digital public infrastructure such as the Unified Payments Interface (UPI).

The rapid rise of retail investors in equities has also transformed India into one of the world’s largest markets for equity options trading.

India’s financial system is diverse and well-developed, with total assets amounting to nearly 190 per cent of GDP. While banks hold around 60 per cent of the financial system’s assets, NBFCs have expanded their market share significantly.

Nearly half of the credit to the private sector now comes from non-banking financial institutions, including insurers, pension funds, and investment funds.

The IMF notes that state-owned NBFCs dominate the sector, with the top three government-owned infrastructure financing companies (IFCs) holding one-third of total NBFC assets. Unlike private-sector NBFCs, state-owned entities are currently exempt from large exposure limits, raising regulatory concerns.

The report recommends aligning regulations for both state-owned and private NBFCs to mitigate risks. (ANI)

 

 

RBI will have to cut CRR to ease banking liquidity; Mahakumbh leads to significant cash withdrawals: SBI Report

New Delhi [India], March 4 (ANI): The Reserve Bank of India (RBI) will have to cut the Cash Reserve Ratio (CRR) to ease the prevailing liquidity pressure in the banking sector, according to a report by State Bank of India (SBI) research.

The report highlighted that with unchanged ownership in government securities (G-secs) in the financial year 2025-26 (FY26), the Open Market Operations (OMO) gap could still be around Rs 1.7 trillion. This suggests that additional liquidity measures may be required on a sustained basis.

It said “Liquidity Estimation; CRR cut is necessary to ease the pressure, RBI could look into using CRR more as a regulatory intervention tool / countercyclical liquidity buffer rather than as a liquidity tool in future”.

According to the report, RBI should explore using CRR more as a regulatory intervention tool or a countercyclical liquidity buffer, rather than relying on it as a liquidity tool in future.

The current liquidity conditions, combined with the projected OMO gap, underline the necessity of proactive measures to maintain stability in the financial system.

The report also called for a reassessment of RBI’s existing liquidity management framework. It suggested replacing the Weighted Average Call Rate (WACR) as the policy rate, arguing that it does not effectively serve its intended purpose.

The current framework, according to the report, may need modifications to align with evolving market conditions and liquidity requirements.

The Indian banking system’s liquidity has seen its worst liquidity crunch of more than a decade. The system liquidity moved from a surplus of Rs 1.35 lakh crore in November to a deficit of Rs 0.65 lakh crore in December, further to Rs 2.07 lakh crore deficit in January and Rs 1.59 lakh crore in February.

Additionally, the report pointed out an inadvertent cash leakage due to Mahakumbh, a major religious event.

The report says that during Mahakumbh a significant portion of cash withdrawals were made by retail depositors, whereas fresh deposit accretions have come from non-retail participants.

As a result, a substantial part of the withdrawn currency may not return to systemic deposits, at least until the end of March.

With these factors in mind, the report highlighted the urgency for RBI to take proactive steps to address liquidity concerns. A CRR cut, it said, would provide immediate relief and help stabilize banking system liquidity, ensuring smoother financial operations in the coming months. (ANI)

Mutual Fund investors in India to rise from 4.5 crore to 26 crore by 2047: PwC Report

New Delhi [India], March 4 (ANI): The number of unique mutual fund investors in India is expected to grow by over 5 times from 4.5 crore to 26 crore by 2047 as the country moves towards its Viksit Bharat goal, according to a report by PwC.

The report highlighted the increasing role of mutual funds in wealth creation and financial inclusion, projecting a rise in market participation and deeper investor engagement in the coming decades.

It said “The number of unique mutual fund investors is expected to grow from 4.5 crore to 26 crores during this period, with the average AUM per retail investor reaching INR 74 lakh”.

The report also mentioned that the mutual funds reach in the country remains relatively low. As of January 2025, only 5.33 crore investors have invested in mutual funds, whereas over 25 crore people shop online, and 2.8 crore travel abroad.

This suggested that a large segment of India’s population is yet to explore mutual funds as an investment option.

To tap this vast potential, the industry needs to shift from a product-centric approach to an investor-focused strategy. This means understanding the diverse financial aspirations and challenges of different sections of society and offering tailored solutions.

The report also forecasted a gradual shift in the retail-institutional mix of mutual fund assets under management (AUM). Currently, the ratio stands at 64:36, but by 2047, it is expected to move towards a 70:30 split, aligning with trends seen in developed markets.

It said “The retail-institutional mix in mutual fund AUM is projected to shift gradually from the current 64:36 ratio to a 70:30 split by 2047, mirroring developed markets. Sustained market returns of 11 per cent annually and increasing mutual fund penetration from nearly 3 per cent to 15 per cent of the population will support this transformation”.

To achieve this transformation, the report added that the mutual fund industry must focus on three key factors: strategic orchestration, infrastructural resilience, and regulatory sophistication. These factors will determine the industry’s ability to scale, innovate, and make financial participation accessible to all sections of society.

The report emphasized the need for a central entity to coordinate efforts and balance the interests of investors, distributors, asset management companies (AMCs), and regulators.

As India progresses towards its 2047 vision, the mutual fund industry is expected to evolve into a more investor-friendly and widely accepted financial instrument, contributing to the country’s economic growth and wealth creation. (ANI)

We gave benefits of Subhadra Scheme to more than 98 lakh women: Odisha Deputy CM Pravati Parida says further assistance on March 6, 8

Bhubaneswar (Odisha) [India], March 4 (ANI): Odisha Deputy Chief Minister and Minister of Women and Child Development Pravati Parida asserted that more than 98 lakh women received benefits from the Subhadra Scheme, and further assistance will be given on March 6 and International Women’s Day on March 8.

Pravati Parida said, “We gave benefits of Subhadra Scheme to more than 98 lakh women. Our target was to give the benefits of the scheme to more than 1 crore women. On March 6, we will give assistance to more than 1,70,000 women. On 8th March, we will provide Rs 5,000 crore to 1 crore women”

Chief Minister Mohan Charan Majhi announced the approval of an initiative for women’s empowerment, Subhadra, in the state legislative assembly in August 2024.

“I take this opportunity on this auspicious day to inform this House about the approval of a path-breaking initiative for women’s empowerment, Subhadra, by the state cabinet. As decided by the state cabinet in its meeting held on August 22, 2024, at Lok Seva Bhawan, the scheme has been approved for implementation from the financial year 2024-25 to the financial year 2028-29. An outlay of Rs 55,825.00 crore has been made for this initiative,” a press release from the CMO said on August 24.

According to the CMO, Subhadra will transform the lives of more than 1 crore women in the state. It will cover all eligible women aged 21 years or above and less than 60 years old.

A total of Rs 10,000 per annum will be paid in two instalments of Rs 5000 each on Rakhi Purnima Day and International Women’s Day (March 8). Thus, an eligible woman beneficiary will get Rs 50,000 in total in five years, the CMO added.

In order to ensure transparency in providing assistance, the payment will be made directly to the beneficiary’s Aadhaar-enabled single-holder (DBT) bank account through the Aadhaar Payment Bridge System (APBS). A Subhadra Debit Card will also be issued to the beneficiaries.

In order to encourage digital transactions, 100 beneficiaries with maximum digital transactions will be identified in each Gram Panchayat and Urban Local Body and an additional incentive of Rs 500 shall be given to each of them.

“Our government is committed towards ‘Antyodaya’. Hence, women from economically well-off families, government servants or Income Tax payees will not be eligible under this scheme. Besides, women who are receiving assistance of Rs 1,500 or more per month or Rs 18,000 or more per year under any other government scheme will also be ineligible for inclusion under Subhadra,” the CMO’s release said. (ANI)

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