The mutual fund industry’s average assets under management of fund houses for the June quarter grew four per cent. According to data from the Association of Mutual Funds in India (AMFI), average AUM for the June quarter was Rs 6.92 lakh crore versus Rs 6.64 lakh crore in March.
Assets under management represent the total value of funds handled by fund houses at the end of any time period. It is the total value of their investment portfolio and the cash balances.
Debt, major contributor
Debt funds continue to be the major contributor to the growth of the mutual fund industry. “This is entirely on account of growing assets in the fixed income products. Equity funds have not been able to mobilise any meaningful assets,” said Mr Dhirendra Kumar, CEO, Value Research, a Delhi-based mutual fund research firm.
In the months of April and May, a total of 80 new schemes were launched, of which 79 were in the debt fund category and one in the open-ended equity category. The new debt schemes accumulated Rs 8,863 crore, while the equity fund only garnered Rs 18 crore on completion of allotment. Data for new schemes launched for the month of June was not available on the AMFI Web site.
Investors stay away
Experts said investors preferred to stay away from equities. “Equity funds have given returns in the range of 0.5 -1 per cent over the last three months. Even on a month-on-month basis, the AUM has not gone up significantly,” said Mr. Kumar.
HDFC Mutual Fund continues to be the top fund house in the country with assets worth Rs 92,624 crore. The next four include Reliance, ICICI Prudential, UTI and Birla Sun Life.
Compared to the March quarter, the top five fund houses have seen an average growth of 5.2 per cent in their AUM. Birla Sun Life recorded the highest AUM growth at 10 per cent.
ICICI Prudential’s AUM rose by 6.3 per cent, HDFC grew by 3.05, Reliance by 3.3 and UTI grew 3.4 per cent.
However, compared to the corresponding quarter of last year (April-June 2011) all these fund houses, except HDFC and Birla, have seen a sharp decline in AUM.
While HDFC rise was marginal at 0.6 per cent, Birla Sun Life saw a decline of 0.4 per cent. Reliance has seen the highest decline at 20 per cent, followed by UTI at 12 per cent and ICICI at 8.4 per cent.
About ten fund houses saw their AUMs decline. At 47 per cent, Escorts Mutual Fund’s AUM declined the most to end at Rs 112 crore at the end of the June quarter.