“I’m not saying that redemptions should not be taken into cognizance at all. All I’m saying is how to read the numbers. We take gross flows because this is the sum total of small investments that come in. Redemptions happen in bulk of what has been accumulated over long periods of time,” Chalasani told reporters over a call.
Every month, AMFI releases monthly SIP investment data which has gross numbers. Critics often cite net inflows, which takes into account redemptions as well, to indicate that the mutual fund industry could be window-dressing the SIP inflow numbers.
“We thought we would better clarify how to read the numbers. We just want to clarify that redemptions should not be read with the SIP numbers,” he said.
Giving the example of a Rs 10,000 monthly SIP, he said if an investor withdraws Rs 6 lakh after 5 years but continues SIP, the redemption should not be considered while looking at the broader picture.
“Redemption is the sum total of what you have invested over a longer period of time. In accounting parlance, if I put Rs 100 every month and then withdraw Rs 10,000 which I have invested over a period of 10 years, there will be a net outflow. But I actually continue to invest Rs 100 even when I am making a withdrawal of Rs 10,000 to invest in some other scheme. So what do I need to look at to see whether the SIP numbers are growing or not? If it is growing, it’s good,” Chalasani said.July month SIP data shows that inflows rose to Rs 23,332 crore against Rs 21,262 crore in June. The number of new SIPs registered in July stood at 72,61,928. The SIP AUM was highest ever at Rs 13.09 lakh crore for July 2024 compared to Rs 12.43 lakh crore for June 2024.The number of SIP accounts stood at the highest ever at 9.3 crore vs 8.99 crore in June.
Also read | Mutual fund SIP inflows surge 10% to surpass Rs 23,000 crore for the first time
