The combined corpus of Indian mutual funds in March declined 5% to Rs 7,43,950 crore, compared with the previous month. Industry officials said that the dip was expected, as corporates withdrew money to pay advance tax, and partly, to balance their account books for the financial year. Association of Mutual Funds in India (Amfi) data considers the average of the assets managed by fund houses during the month.
Among the top five fund houses, HDFC and Birla Sun Life reported a 6% plus decline in their average assets under management (AUM), compared with the previous month. Reliance Mutual Fund, the number one fund house by assets, logged a 4.6% dip in its assets.
ICICI Prudential and UTI clocked an increase of 0.6% and 1%, respectively, in their assets. So far, 37 of the 38 fund house have released their assets under management numbers. Only Baroda Pioneer Asset Management is yet to announce its numbers.
Despite the monthly decline, the asset base of the mutual fund industry has risen 35% during financial year 2009-10, compared with a 14% decline in the previous year. However, the growth in corpus for 2009-10 has been driven by debt assets rather than equity assets.
From an AMC’s perspective, equity assets are crucial to profitability, as they earn a fund management fee nearly three times of that earned by debt assets. But fund houses don’t mind piling up debt assets, as they boost their overall valuation.
From March ’09 to February ’10, the debt assets of the industry have surged by about Rs 1,98,684 crore, which is huge, compared with the Rs 17,416 crore in the previous year. This year’s rise in debt AUM can be attributed to funds parked by the banking industry with mutual funds on account of excessive liquidity and slow credit offtake.
For the fortnight ended March 12, ’10, banks had an outstanding investment of Rs 1,08,516 crore in mutual funds which is much higher than their investment of Rs 36,781 crore a year ago.
But while the debt assets have been soaring, market volatility and the Sebi rule scrapping entry load in equity schemes of mutual funds have stunted the growth in equity assets in 2009-10. The March ’09 to February ’10 period saw industry’s equity assets increase by just Rs 4,068 crore. During March ’08-February ’09 period, equity assets had grown by Rs 10,623 crore. But for the corresponding period in 2007-08, these assets had surged by about Rs 44,837 crore.
Source: http://economictimes.indiatimes.com/personal-finance/mutual-funds/mf-news/Debt-plans-boost-mutual-funds-asset-base-in-FY10/articleshow/5755764.cms
Among the top five fund houses, HDFC and Birla Sun Life reported a 6% plus decline in their average assets under management (AUM), compared with the previous month. Reliance Mutual Fund, the number one fund house by assets, logged a 4.6% dip in its assets.ICICI Prudential and UTI clocked an increase of 0.6% and 1%, respectively, in their assets. So far, 37 of the 38 fund house have released their assets under management numbers. Only Baroda Pioneer Asset Management is yet to announce its numbers.
Despite the monthly decline, the asset base of the mutual fund industry has risen 35% during financial year 2009-10, compared with a 14% decline in the previous year. However, the growth in corpus for 2009-10 has been driven by debt assets rather than equity assets.
From an AMC’s perspective, equity assets are crucial to profitability, as they earn a fund management fee nearly three times of that earned by debt assets. But fund houses don’t mind piling up debt assets, as they boost their overall valuation.
From March ’09 to February ’10, the debt assets of the industry have surged by about Rs 1,98,684 crore, which is huge, compared with the Rs 17,416 crore in the previous year. This year’s rise in debt AUM can be attributed to funds parked by the banking industry with mutual funds on account of excessive liquidity and slow credit offtake.
For the fortnight ended March 12, ’10, banks had an outstanding investment of Rs 1,08,516 crore in mutual funds which is much higher than their investment of Rs 36,781 crore a year ago.
But while the debt assets have been soaring, market volatility and the Sebi rule scrapping entry load in equity schemes of mutual funds have stunted the growth in equity assets in 2009-10. The March ’09 to February ’10 period saw industry’s equity assets increase by just Rs 4,068 crore. During March ’08-February ’09 period, equity assets had grown by Rs 10,623 crore. But for the corresponding period in 2007-08, these assets had surged by about Rs 44,837 crore.
Source: http://economictimes.indiatimes.com/personal-finance/mutual-funds/mf-news/Debt-plans-boost-mutual-funds-asset-base-in-FY10/articleshow/5755764.cms
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