Religare Invesco MF says group investments at 1% of AAUM

Group exposure is Rs 143 cr, Religare is first fund house to make such a disclosure after Reliance MF

In a second of its kind of disclosure, Religare Invesco Mutual Fund (RIMF) has said that the investment of group companies in its schemes for the quarter ended December 31, 2013 stood at Rs 143.15 crore.
     
At Rs 143.15 crore, the group investments of Religare Invesco MF account for a little over one per cent of the fund house's total average assets under management.
     
This is the second such disclosure in the mutual fund space after Reliance Mutual fund had said that its group investments stood at 3.2 per cent of AAUM.
     

"Average Assets Under Management (AAUM) of Religare Invesco Mutual Fund (RIMF) for the quarter ended December 31, 2013 of Rs 13,733.53 crore includes AAUM of Rs 143.15 crore (1.04 per cent) from sponsor, group and associate of companies of Sponsor," as per information available on the company's website.

     
Fund houses so far have not been disclosing the exact amount of investments by their group companies in their respective schemes, but industry estimates suggest that such investments vary from as low as 3 per cent to as high as 20 per cent for different AMCs.
     
Meanwhile, mutual fund industry body Amfi may soon suggest making it mandatory for fund houses to disclose the investments made in them by group companies, which is estimated to be well above Rs one lakh crore.
     
According to industry experts, such kind of disclosure is a good move as investors are generally guided by rankings and these rankings may change if group investments are excluded from the AUM.

     
Many large fund houses have significant chunk of investments coming from their group entities, and so the ranking as per average AUM (Assets Under Management) may not show the true strength of a mutual fund.
     
According to industry estimates, group firms have investments to the tune of Rs 15,000 crore in Birla AMC, while for ICICI AMC the amount stands at Rs 12,000 crore, HDFC AMC between Rs 10,000-15,000 crore and Tata AMC between Rs 8,000-10,000 crore.