Mutual funds' assets rise 9% in June quarter

Out of 45 fund houses, 35 posted increase in assets

India’s mutual fund industry has continued to grow its average assets under management (AUM) during the quarter ended June. According to statistics released by the industry body Association of Mutual Funds in India (Amfi), the total average AUM for the quarter grew 9.06 per cent to Rs 9.87 lakh crore against Rs 9.05 lakh crore in the quarter ended March 2014. According to CRISIL, the growth was driven by a rise in assets of equity funds, short-duration funds and fixed-maturity plans (FMPs).

Equity funds witness record rise in AUM

Equity mutual funds saw record absolute rise in average AUM, up by Rs 33000 crore or 16% to Rs 2,36,000 crore led by mark to market gains and inflows. The equity funds’ contribution to the gains in the industry assets was the highest among all categories, added a report from CRISIL. According to it, the latest gain was also the third consecutive gain for the category, and was primarily led by improvement in sentiment for the underlying asset class on hopes of strong economic reforms by a stable majority government at the centre.

 

FMPs’ assets see record high

Assets of FMPs continued to ride to record high levels with a rise of 12% to Rs 1,74,000 crore. Penchant for FMPs can be contributed to the prevailing high interest rate in the economy as it helps investors to lock their investments at higher yields in closed-ended funds, said the report.
 
 Share of direct plans increases to 34%

The share of direct plans increased to 34% of the industry’s AUM (excluding fund of funds) in the reported quarter vis-à-vis 33% in the previous quarter. In terms of growth, the average AUM of direct plans rose around 15% to Rs 3,39,000 crore. Direct plans came into existence on January 1, 2013.

 
Top mutual funds by average AUM log highest gains

Top mutual funds in terms of average AUM posted highest absolute gains in the June quarter. HDFC Mutual Fund’s average AUM retained its top position across fund houses and was the best performer in the June quarter. The fund registered highest absolute rise of Rs 17,000 crore or 15.1% to Rs 1,30,000 crore. Increase in the fund house’s assets was also boosted by acquisition of Morgan Stanley Mutual Fund, which held Rs 2500 crore of average AUM as of March 2014.

ICICI Prudential Mutual Fund maintained the second position at Rs 1,18,000 crore as it gained 10.52%.Reliance Mutual Fund maintained third rank with the asset tally at Rs 1,13,000 crore.

AMCs, which witnessed a major fall in AUM, included JPMorgan Mutual Fund whose average AUM fell by Rs 1,700 crore to Rs 14500 crore and LIC Nomura Mutual Fund whose average AUM declined to Rs 9,489 crore.
 
Out of the 45 fund houses (including IDFs) that have declared their average AUM, 35 posted a rise in AUM.