November flows a blip for AMCs, structural growth drivers remain intact

Analysts cite higher redemptions for 78% dip in equity flows, say lower penetration, rising preference of retail investors for equity market should help AMCs in the long-run

The stocks of listed asset management companies (AMCs) HDFC Asset Management Company (HDFC AMC) and Reliance Nippon Life Asset Management (RNAM) shed around 3 per cent on Tuesday, much more than the 0.6 per cent fall in the S&P BSE Sensex. A sharp month-on-month fall of 78 per cent in equity flows to Rs 1,311 crore in November, reported on Monday evening by Association of Mutual Funds in India (AMFI), negatively impacted investor sentiments.

As AMCs enjoy higher operating margin for managing equity funds, the fall in equity flows is a reason