HOW MUTUAL FUND EQUITY HOLDINGS RANKED SECTORALLY
One way to understand preference shifts of mutual funds is to look at the sectoral shifts. But before that let us look at equity holdings of mutual funds from a comprehensive perspective and how it moved over different time frames. When we talk of equity AUM, we normally refer to AUM of active equity funds. However, there are substantial holdings of equities in hybrid funds and index funds, which must be added.
For instance, if you look at the AUM of active equity funds as of March 2025, it stood at ₹29.45 Trillion. However, the overall equity holdings of Indian mutual funds were much bigger at ₹41.11 Trillion. That means ₹11.66 Trillion (28.4) of equity holdings by mutual funds was accounted for by hybrid funds and index funds. It is this total equity holding of ₹41.11 Trillion that we shall use for our analysis.
SECTORS WHERE MF EXPOSURE WAS ABOVE ₹1 TRILLION
The equity AUM of all mutual funds stood at ₹41.11 Trillion as of March 2025, higher than ₹38.24 Trillion as of end of February 2025 and at ₹33.13 Trillion in the year ago period. However, this AUM is lower compared to December 2024 at ₹42.21 Trillion. Here are the top sector holdings.
| Sectors | March 2024 | December 2024 | February 2025 | March 2025 |
| Banking & Finance | 9,44,033 | 11,41,448 | 11,19,408 | 12,05,006 |
| IT-Services | 3,08,565 | 4,37,550 | 3,86,272 | 3,83,076 |
| Auto & Auto Ancillaries | 3,07,534 | 3,82,435 | 3,43,487 | 3,59,875 |
| Pharmaceuticals | 2,74,680 | 3,73,670 | 3,27,990 | 3,56,809 |
| Oil & Gas | 2,24,869 | 2,36,718 | 2,21,897 | 2,44,557 |
| FMCG | 1,68,173 | 2,13,481 | 1,94,612 | 2,06,514 |
| Capital Goods | 1,16,944 | 1,61,991 | 1,19,643 | 1,41,155 |
| Telecom | 88,575 | 1,27,002 | 1,23,314 | 1,33,005 |
| Metals & Mining | 1,07,513 | 1,25,632 | 1,21,922 | 1,32,855 |
| Retail | 80,933 | 1,36,876 | 1,18,573 | 1,27,671 |
| Power | 1,02,156 | 1,23,339 | 1,10,926 | 1,27,615 |
| Infrastructure | 1,15,771 | 1,33,837 | 1,10,895 | 1,21,098 |
| Chemicals & Fertilisers | 87,356 | 1,09,534 | 1,01,291 | 1,12,169 |
Data Source: AMFI, MF Websites (₹ in Crore)
These top 13 sectors account for 88.8% of the total equity AUM of Indian mutual funds. There is not much of a surprise in the list, with financials and IT leading the market cap rankings. If you compare with the year ago period, there are some sectors that have seen a sharp spike like Pharmaceuticals, banking, telecom, retail, and chemicals & fertilizers. Which are the sectors to have lost value compared to December 2024?
IT, automobiles, and capital goods are the three sectors that have seen AUM depletion compared to December 2024. These have been the most vulnerable to the slowdown in the US likely to be induced by the tariff war. Compared to February 2024, only IT has seen AUM depletion in March 2025. This is due to the double whammy of slowing tech spending and weak dollar, as evidenced by the dollar index (DXY) below 100.
SECTORS WITH THE BEST YOY AUM ACCRETION
Let us look at rupee value accretion in AUM of sectors between March 2024 and March 2025 and rank on absolute increase in AUM.
| Sectors | March 2024 | March 2025 | AUM Change | (% Change) |
| Banking & Finance | 9,44,033 | 12,05,006 | 2,60,973 | 27.64% |
| Pharmaceuticals | 2,74,680 | 3,56,809 | 82,129 | 29.90% |
| IT-Services | 3,08,565 | 3,83,076 | 74,511 | 24.15% |
| Auto & Auto Ancillaries | 3,07,534 | 3,59,875 | 52,341 | 17.02% |
| Retail | 80,933 | 1,27,671 | 46,738 | 57.75% |
| Telecom | 88,575 | 1,33,005 | 44,430 | 50.16% |
| FMCG | 1,68,173 | 2,06,514 | 38,341 | 22.80% |
| Power | 1,02,156 | 1,27,615 | 25,459 | 24.92% |
| Metals & Mining | 1,07,513 | 1,32,855 | 25,342 | 23.57% |
| Chemicals & Fertilisers | 87,356 | 1,12,169 | 24,813 | 28.40% |
| Consumer Durables | 60,045 | 84,295 | 24,250 | 40.39% |
| Capital Goods | 1,16,944 | 1,41,155 | 24,211 | 20.70% |
| Oil & Gas | 2,24,869 | 2,44,557 | 19,688 | 8.76% |
| Construction Materials | 76,466 | 92,924 | 16,458 | 21.52% |
| Aviation | 16,966 | 27,827 | 10,861 | 64.02% |
Data Source: AMFI, MF Websites (₹ in Crore)
Here we look at the sectors that showed the best AUM accretion in rupee terms. It must be noted that this shows the actual AUM value created, but it can be biased in favour of large sectors. Here are some quick findings. The second best AUM accretion is seen in pharma & healthcare, which is surprising as it is not among the 5 most heavyweight sectors. Retail and telecom are again sectors that have seen substantial value accretion yoy. Retail is largely driven by the digital retail stories while the telecom story is driven by Bharti Airtel. To get a more unbiased picture of growth, let us also look at sector shifts in percentage terms.
SECTORS WITH THE BEST PERCENTAGE AUM ACCRETION
If rupee value accretion in AUM of sectors between March 2024 and March 2025 was biased in favour of heavyweight sectors, the percentage change parameter will avoid that.
| Sectors | March 2024 | March 2025 | AUM Change | (% Change) |
| Aviation | 16,966 | 27,827 | 10,861 | 64.02% |
| Retail | 80,933 | 1,27,671 | 46,738 | 57.75% |
| Telecom | 88,575 | 1,33,005 | 44,430 | 50.16% |
| Consumer Durables | 60,045 | 84,295 | 24,250 | 40.39% |
| Alcohol | 19,942 | 27,574 | 7,632 | 38.27% |
| Agri | 11,915 | 16,447 | 4,532 | 38.04% |
| Diversified | 13,948 | 18,257 | 4,309 | 30.89% |
| Pharmaceuticals | 2,74,680 | 3,56,809 | 82,129 | 29.90% |
| Chemicals & Fertilisers | 87,356 | 1,12,169 | 24,813 | 28.40% |
| Banking & Finance | 9,44,033 | 12,05,006 | 2,60,973 | 27.64% |
| Power | 1,02,156 | 1,27,615 | 25,459 | 24.92% |
| IT-Services | 3,08,565 | 3,83,076 | 74,511 | 24.15% |
| Metals & Mining | 1,07,513 | 1,32,855 | 25,342 | 23.57% |
| FMCG | 1,68,173 | 2,06,514 | 38,341 | 22.80% |
| Others | 23,834 | 29,261 | 5,427 | 22.77% |
Data Source: AMFI, MF Websites (₹ in Crore)
Here we look at the sectors that showed the best AUM accretion in terms of percentage change in AUM. Some of the sectors may not be too relevant if the base is very small. However, in the above case, we can see that mutual fund buying interest was prominent in sectors like aviation, telecom, digital retail etc.
What are the sectors at the bottom of accretion ranking. Sectors like media, plastics, and paper are the ones were mutual funds have either pared positions or exited fully in March 2025. Clearly, the traction has been positive on MOM and YOY basis, although there is some AUM pressure compared to the end of December 2024.