MFs uneasy with AMC-wise data declaration

After opposing the idea of monthly declaration of assets under management (AUM), the domestic fund industry seems uncomfortable with publishing asset management company-wise data too.

The Association of Mutual Funds in India (Amfi) is understood to have taken up the issue. At least two persons familiar with the development told Business Standard that Amfi’s board was likely to discuss the demand soon.

Fund managers say that every first week of a month, the industry invites undue attention with ups and downs in its assets on the back of redemptions.

“Quite often, money from one fund house flows to another, which brings unwanted competition among the players,” said the CEO of a large fund house.

Independent experts said the debate could be useful as part of a process to put things in better order for an industry under pressure from both regulator and investors. “It is a desirable discussion. The size of fund houses does not matter. What matters is the performance of their funds,” said Dhirendra Kumar, CEO of Value Research, which tracks the domestic fund market.

The executive director of a domestic brokerage firm which tracks the industry said, “Ever since the entry load ban has come into force, the entire industry is in disorder. It is a precarious situation for the industry. It has triggered a discussion at Amfi as large fund houses are becoming larger and smaller players are getting squeezed.”

Amfi has indicated its acceptance of the industry’s concerns on declaration of monthly AUM and wants only retail assets to be declared. Industry players said there was a consensus on separate declaration of institutional and retail assets.

H N Sinor, chief executive officer of Amfi, had told Business Standard earlier that publishing monthly data would not fully reflect things.

The industry’s average assets under management on August 31 was Rs 6.87 lakh crore, a rise of 3.3 per cent against the previous month. However, on a year-on-year basis, the assets declined over eight per cent. According to industry observers, the actual size of retail assets is not more than Rs 2.5 lakh crore, with the rest of the money being that of institutions, which come and go in line with the market movement.