MF industry assets drop 5% in March

The country's mutual fund industry witnessed nearly 5 per cent drop in the average asset under management (AUM) in February to Rs 7.44 lakh crore.

The industry's average AUM fell by Rs 37,761 crore or 4.83 per cent during March. The combined average AUM of the 37 fund houses stood at Rs 7,43,950.46 crore.

The country's largest fund house Reliance MF saw an erosion of Rs 5,340 crore or 4.61 per cent from its average assets to Rs 1.10 lakh crore, as per data released by the Association of Mutual Funds in India (AMFI).

The second-largest fund house in the country, HDFC MF, witnessed a decline of Rs 6,364 crore. However, the third in the row ICICI MF bucked the trend and witnessed an addition of Rs 462 crore, while UTI MF saw an addition of Rs 908 crore.

During March, the BSE Sensex gained seven per cent to 17,528 points as the post-budget rally led to increased foreign fund inflow into the country.

Analysts said huge dividend payout by mutual funds and bank's withdrawal of money from debt fund schemes led to a decline in the AUMs.

"While funds announced dividends for equity portfolios out of the substantial gains earned in investment in stock market, banks withdrew money from income and liquid schemes which led to outflow," Taurus MF Managing Director R K Gupta said.

At the end of March, HDFC MF had an AUM of Rs 88,779.84 crore, ICICI MF had an AUM of Rs 80,988.85. Besides, UTI MF's average assets stood at Rs 80,217.81 crore.

Over the month the average assets of Birla Sun Life MF fell by over Rs 3,962 crore to Rs 62,343 crore and Axis MF witnessed a Rs 202 crore in its AUM to Rs 3,552 crore.

The other fund houses which saw their average AUM decline in March include Religare MF, Fortis MF, Franklin Templeton MF and Tata MF.

Some of the fund houses whose AUMs increased are DSP BlackRock MF whose assets grew by Rs 1,557 crore to Rs 21,491 crore in March. Others that saw an addition to their assets include Bharti AXA MF, Edelweiss MF, Escorts MF and Morgan Stanley MF.

After touching a record high of Rs 8 lakh crore in November 2009, the average AUM of the MF industry fell for two consecutive months. While in December the industry AUM declined by 3.55 per cent, in January the assets fell by 4.13 per cent on a month-on-month basis and in February, the AUM increased by 3 per cent.