Domestic MFs halve ownership gap with FIIs in NSE-listed firms to 5.5% in Dec '25, Pg19

Key Highlights:

• Domestic Mutual Funds (MFs) narrowed their shareholding gap with Foreign Institutional Investors (FIIs) in NSE-listed companies to 5.5% by December 2025.
• The shareholding gap between MFs and FIIs was 10.51% at the end of December 2022.
• At its peak, the gap was 17.14% on March 31, 2015, with FIIs at 20.70% and MFs at 3.56%.
• Net Assets Under Management (AUM) in equity-oriented schemes surged 134% in the three years to December 2025.
• MFs invested Rs 1.06 lakh crore in the December quarter on a net basis, while net FII outflows were Rs 11,765 crore.
• Domestic Institutional Investors (DIIs) ownership in firms hit a peak of 18.72% as of December 31, 2025, from 18.28% on September 30.

Detailed Insights:

• The increasing investment by MFs, driven by strong inflows from retail investors, indicates a growing atmanirbharta (self-reliance) in Indian equities.
• The trend of domestic MFs gaining ground started with demonetization in 2016 and accelerated during the COVID-19 years.
• Higher inflows supported by Systematic Investment Plans (SIPs) have boosted the share of DIIs ownership in NSE-listed firms.
• The shift in ownership balance suggests a strengthening domestic market supported by retail participation and confidence in Indian equities.

Key Concepts Involved:

• Mutual Funds (MFs): Investment vehicles that pool money from multiple investors to purchase securities.
• Foreign Institutional Investors (FIIs): Investors or investment funds investing in a country from outside of that country.
• Atmanirbharta: The state of being self-reliant or self-sufficient, especially at the national level.
• Systematic Investment Plan (SIP): An investment plan where investors make regular, periodic payments into a mutual fund.