Fixed income funds spur MFs, no takers for equity plans yet

Thu, Nov 5 01:50 AM

Indian mutual fund industry registered growth in their monthly asset under management (AUM) for the month of October, largely due to the inflow of the fixed income funds. However, there have been redemptions in the equity schemes, according to some of the fund industry participants.

According to the figures provided by the Association of Mutual Funds in India (Amfi), total AUM of 36 fund houses stood at Rs 7,61,023.21 crore in October, gaining Rs 18,112.37 or 2.44% from Rs 7,42,910.83 crore recorded in September.

"It is always seen that after the end of every quarter the AUM numbers are positive for the next month, so it is same with the month of October. Despite good show in the AUM numbers, still equity funds are not attracting inflows. The inflows are largely in the fixed income schemes in the month of October," said Dhirendra Kumar, CEO of Valueresearch online.

Senior official from the leading fund house said several corporates who had pulled out money from the mutual funds in September to meet advance tax requirement have once again started investing.

Out of 36 fund houses, 12 MF companies, like Religare, Fidelity and Baroda Pioneer, saw fall in their monthly AUM for October.

While several small fund houses like Taurus, Shinsei and Edelweiss saw a decent rise in its AUM, their bigger peers, like HDFC, UTI, Birla Sun Life, Kotak Mahindra and ICICI Prudential saw increase in their AUM value. For instance, HDFC's AUM for October stood at Rs 93,316.03 crore, gaining Rs 2,888.77 crore or 3.19%, compared to Rs 90,427.26 crore in September.

However, country's largest fund house, Reliance saw a decline in their AUM to Rs 1,16,781.91 crore in October, down Rs 1469.51 crore, or 1.24%, from Rs 1,18,251.43 crore registered in the preceding month.

JP Morgan, on the other hand, saw a rise of 13.32% or Rs 605.59 crore to take its AUM value to Rs 5,151.37 crore, from Rs 4,545.77 crore recorded in the month of September. Krishnamurthy Vijayan, executive chairman of JP Morgan, said, "The increase in our AUM value was largely due to the strong inflows in our treasury fund. Liquid funds have also seen good amount of inflows. Slowly and steadily, we are witnessing some positive signs in the industry as market conditions are improving and distributors are finding new models to sell the funds."

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