Local MFs outpace foreign players in asset growth in FY13

Domestic houses' assets grow 23.5% while outside players could manage 17.5%

Domestic mutual fund houses are back in the game. After losing out to their foreign counterparts (having presence in India) for two consecutive years, local MFs have done better in terms of rise in their assets under management (AUM) in 2012-13.

The year gone by, which proved one of the toughest periods for India's fund industry, saw local players gain 23.5% in their assets at Rs 7.24 lakh crore. This has surpassed the AUM growth of foreign player which could manage a rise of 17.55% during FY13.

Not only locals MFs outpaced the foreign houses but also beat the industry's average growth of 22.8%.

In FY13, India's benchmark indices gave a return of 10.4% amid high volatility. This kept the retail equity investors away from investing in stocks related instruments. On the other hand, debt side of the sector saw a whopping rise of inflows pushing the overall assets of the industry up at pace not seen over last three years.

Interestingly, in the previous financial year, at a time when industry's assets had declined by a little over 5% (as local MFs failed to come back in the positive territory of growth), foreign players managed to continue with their lead with a growth of around 6%.

There are 44 players in country's fund industry. Domestic fund houses include HDFC MF, Reliance MF, ICICI Pru MF, UTI, SBI MF, LIC MF and Birla Sun Life MF, among others. While players like HSBC AMC, Mirae Asset, Baroda Pioneer, Franklin Templeton, Goldman Sachs, JP Morgan and BNP Paribas are among the foreign fund houses in India.

As on 31 March, 2013, the overall average AUM of the industry stood at Rs 8.16 lakh crore against Rs 6.64 lakh crore in the previous financial year.

Table : Showing asset growth trend for last few years

	FY10	FY11	FY12	FY13
Domestic	53.97	-7.33	-6.4	23.55
Foreign	32.76	-1.68	5.94	17.55
Industry	51.44	-6.23	-5.11	22.80

All figures in %

Source : Amfi (Compiled by BS)