Equity funds grab 55% of India's mutual fund (MF) assets, Nagaland tops monthly growth

India’s mutual fund industry continues to grow rapidly, with Average Assets Under Management (AAUM) rising 21.94% YoY and 3.61% MoM as of June 2025, according to ICRA Analytics. Equity-oriented schemes remained dominant, accounting for 54.76% of total AAUM, underlining investor appetite for long-term wealth creation. Debt- and liquid-oriented schemes followed with 14.88% and 12.50%, respectively. Maharashtra retained its leadership with a 40.61% share of total mutual fund assets, supported by its robust financial infrastructure. However, the spotlight increasingly shifted to smaller states and union territories, which witnessed exceptional growth. Nagaland’s AAUM surged 100.57% YoY, followed by Dadra & Nagar Haveli at 56.52%. Ladakh and Lakshadweep also recorded double-digit MoM increases in June 2025.
Despite operating from a low base, these emerging regions revealed encouraging trends in equity fund adoption; equity schemes made up 90.85% of mutual fund assets in Ladakh and 84.07% in Lakshadweep. This shift from traditional savings options such as fixed deposits and gold to market-linked investments is being fuelled by rising smartphone penetration, fintech-led digital onboarding, and growing financial literacy. Daman and Diu posted the slowest YoY growth at 13.50%. With over 65% of total AAUM concentrated in five states, Maharashtra, Delhi, Gujarat, Karnataka, and West Bengal, the industry has ample headroom to deepen its reach in tier-II and tier-III cities. This underlines the potential of India’s untapped retail investor base and sets the stage for broader financial inclusion in the years ahead.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.