Mirae growth story

There is no exciting friendship between foreign fund houses and Indian MFs. Big MF names; Fidelity, JPM, Deutsche, Morgan Stanley and Goldman entered and exited India in a hurry. It looked like Templeton was the last big foreign fund standing, but that also changed after the debt fund fiasco of Apr-20. Now Mirae has emerged as the largest foreign fund in the difficult Indian MF market, which is what makes it unique. But, there is more to the Mirae story than just scaling the Rs.1 trillion mark. 

How Mirae got there pretty fast?

Unlike the names like Morgan Stanley or Templeton that entered India 25 years ago, Mirae is a more recent entrant. It started its India operations at the peak of the global financial crisis in 2008 and its growth was between 2016 and 2021 during which period its AUM jumped six-fold from Rs.16,400 core to Rs.100,000 crore. One can say that this AUM was largely driven by a surge in the Nifty and the Sensex but that was the case for all funds. Mirae has surely done 3 things very differently and that explains this stupendous growth in its AUM. 

Equities, performance, SIPs

If you look at the growth of Mirae MF, it was led by 3 factors viz. equity focus, consistent performance and a SIP focus. The equity AUM is 84% of overall AUM, the highest share for any mutual fund in India. Secondly, pick up any ranking of best performing equity funds over last 1 year, 3 years and 5 years and you are bound to find one of the top Mirae funds in that list. This consistency has acted like a magnet for flows. Lastly, Mirae had a strong focus on retail SIPs. Out of the 43.7 lakh folios with Mirae, more than one-third or 15.4 lakh folios are SIP folios. In Sep-21, Mirae alone was responsible for 8% of overall SIP flows. 

Mirae story gives hope to MFs

Why do we say that the story of Mirae is a story of hope for the mutual funds. Firstly, it proves that it is possible to build scale with a pure equity approach and a pure retail-SIP based approach. It also proves that you do not have to be a bancassurance play or affiliated to a big industry house to be able to survive in the Indian mutual fund space. It is also possible to survive and thrive purely based on performance and track record. Lastly, it goes to show that SIP as a pull strategy really works in practice. For the last few years, Mirae has focused on consistent performance of its two large funds as well as continuous investment in educating investors about the merits of a patient and systematic approach!