Sector Assets Rise By A Modest Rs 515 Crore

The year 2001 was a unique one for the mutual fund industry. Overall, the industry reported a modest Rs 515 crore increase in assets under management in calendar 2001, till November-end.

This is despite assets under management of growth (equity) schemes dropping by Rs 6,326 crore. At end of November 2001, the industry had a total Rs 99,841 crore of assets under management, as against Rs 99,326 crore at the end of 2000.

Looking back, 2001 was the second successful year for debt schemes. These plans reported sales of Rs 86,217 crore in the first 11 months of the year. But the inflows were largely matched by outflows following huge profit-bookings and dividend stripping.

This led to a redemption/maturity of Rs 71,670 crore. Consequently, the segment ended the year with a net inflow of Rs 14,547 crore.

Within the broad debt category, money market schemes had the largest sales, of over Rs 52,544 crore, and redemptions of Rs 48,303 crore.

Income funds, as a category, had a net inflow of Rs 8,708 crore; they sold Rs 29,548 crore worth of units and redemptions were at Rs 20,840 crore.

Equity or balanced schemes were done in by poor corporate sector performance, compounded by the terrorist attacks in the US, and more recently, the clouds of an Indo-Pak war.

Equity schemes reported a net outflow of Rs 445 crore during the year as against a net inflow of Rs 1,049 crore last year.

Equity schemes had the maximum redemption in April 2001, with an outgo of Rs 450 crore. However, for the industry, the maximum redemption pressure was in September 2001, with an outflow of Rs 16,017 crore accounting for over 20 per cent of aggregate redemption during the eleven months.

Open-ended schemes were the flavour of the year. During the year, assets under open-ended schemes accounted for 70 per cent of the total assets under equity funds, as against 60 per cent in the previous calendar.

The Unit Trust of India, which accounted for 52 per cent of the industry's assets, suffered a major blow. A ban on fresh sales of units of US-64, and the maturing of more than three schemes pulled the assets under management down to Rs 51,666 crore from Rs 64,239 crore last year.

Interestingly, the private sector fund houses turned investors' favourite with an increase of 42 per cent of assets under management to Rs 39,866 crore.