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Thursday, June 10, 2010

Total Assets of MF Witness Fall of 8.09%

Income funds saw maximum net outflow in May 

Mutual Fund (MF) industry's total assets under management (AUM) witnessed a fall of 8.09% or Rs 65425 crore to Rs 7.43 lakh crore in May 2010 from Rs 8.08 lakh crore in April 2010. This was after the industry's AUM registering a rise of 31.69% in April. The fall in AUM was on account of drop in liquid funds ( down by 35.66%) , income funds (5.85%), , fund of funds investing overseas( by 5.05%), , balanced funds(by 3.53%), ELSS - equity funds (by 3.11%) and equity funds (by 2.91%). While on the positive side, the total AUM of Other ETFs and Gold ETF recorded growth of 12.59% and 7.36%, respectively in May 2010. 

The Average Asset Under Management (AAUM) of MFs climbed 4.47% to Rs 8.03 lakh crore for the month of May 2010, six months high i.e. highest since November 2009 where the AUM stood at Rs 8 lakh crore..

Equity funds, balanced funds and Other ETFs recorded net inflow of funds, while the rest faced net outflow of funds in May 2010. Income and liquid fund category which had huge inflows in April saw huge net outflows in May owing to volatility seen in debt market. Their net outflows were at Rs 35084 crore and Rs 29334 crore respectively in May. 

The MF industry's net outflow was at Rs 62960 crore in May, as against net inflow of Rs 1.85 lakh crore in April 2010. However, it is noteworthy that the industry saw a net inflow of funds to a tune of Rs 1.22 lakh crore for the year to date period in the fiscal 2010-11. 

The funds mobilised from 6 newly launched schemes in May stood at Rs 984 crore. One open-ended income fund - Kotak Credit Opportunities Fund, launched in May, mobilized Rs 361 crore. Four close-ended income funds– HDFC FMP 36M April 2010-SeriesXII, 367D April 2010 (2)-Series XII, Reliance Fixed Horizon Fund-XIV-Series10 and Reliance Dual Advantage Fixed Tenure Fund Plan A which mobilised around Rs 601 crore. While, One open end fund of funds investing overseas - DWS Global Agribusiness Offshore Fund, mobilised Rs 22 crore during the month of May 2010.

Equity Funds 

Total AUM of equity funds was down 2.91% to Rs 1.71 lakh crore in May from Rs 1.76 lakh crore in April, as equity benchmark indices fell due to global cues. BSE Sensex and S&P CNX Nifty tanked 3.50% and 3.63% respectively in May, compared to gains of 0.18% and 0.55% respectively in April. The debt crises in the Eurozone had shaken the domestic as well as the global equity markets.

Despite the fall in asset base the weightage of equity funds increased to 23% of the total assets of the industry in May as against 22% in April. On the other had the category had a net inflow to a tune of Rs 1256 crore, as against net outflows in the previous two months. The corrections in the equity market had enabled the investors to make investment at lower price in order to take advantage of the future rally in the market.

Income Funds 

Total AUM of income funds decreased 5.86% to Rs 4.67 lakh crore in May compared with April. After witnessing net inflows to a tune of Rs 1.77 lakh crore in April, it had net outflows to a tune of Rs 35084 crore in May. Share of assets of income funds in total AUM increased to 63% in May from 62% in April. 

Liquid Funds 

Liquid fund category witnessed net outflow to a tune of Rs 29334 crore in May compared with net inflows of Rs 9275 crore in April. The total asset decreased by 35.66% to Rs 53933 crore in May compared to 7.34% surge in April. Share of assets of liquid funds in total AUM fell to 7% in May from 10% in April.

Gilt Funds 

AUM of gilt funds fell 1.75% to Rs 3376 crore in May from Rs 3436 crore in April. This category had witnessed net outflows for the second consecutive month. The net outflow was at Rs 96 crore, which is higher than the net outflows of Rs 49 crore in April.

Other Funds 

Assets of balanced funds were down by 3.53% in May. However the category witnessed net inflows to a tune of Rs 206 crore in May compared with net outflows to a tune of Rs 57 crore in April.

ELSS-Equity Funds witnessed net outflow of Rs 10 crore and a fall of 3.11% in its total assets. This category had faced net outflows for the second consecutive month; however the net outflows are lower than the previous month net outflows. 

Gold ETFs had net outflow of Rs 6 crore, however its total AUM increased by 7.36% to Rs 1837 crore in May over Rs 1711 crore in April. The total AUM of Other ETFs increased 12.59% in May. Moreover the category had net inflows of Rs 185 crore in May, compared with net inflows of Rs 300 crore in April. Fund of Funds investing overseas witnessed fall of 5.05% in assets.
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