The average assets under management (AUM) of the mutual fund industry increased 28 per cent in the June quarter to ₹23.4-lakh crore against ₹18.3-lakh crore in the March quarter on the back of strong inflows through systematic investment plans (SIPs).
The AUM is up 20 per cent, compared to the last-year figure of ₹19.52-lakh crore. ICICI Prudential Mutual Fund topped the list, recording an average AUM of ₹3.1-lakh crore in the June quarter, against ₹3.06-lakh crore in the March quarter. It was followed by HDFC Mutual Fund with an AUM of ₹3.06-lakh crore (₹3-lakh crore) and Aditya Birla Sun Life at ₹2.49-lakh crore (₹2.47-lakh crore). The average AUM of Reliance Nippon Mutual Fund was at ₹2.4-lakh crore (₹2.45-lakh crore) and that of SBI at ₹2.33-lakh crore (₹2.18-lakh crore).
NS Venkatesh, Chief Executive Officer, Association of Mutual Funds in India, said that despite the recent volatility in the market, mutual funds continued to see strong inflows through the SIP route.
Investments from retail investors remain robust, especially from beyond Top-30 cities, he added. The investor awareness campaign Mutual Funds Sahi Hai, run by AMFI under SEBI guidance, has generated a lot of interest among potential investors, who are now looking at mutual funds as a preferred investment option, he added.
The growth in the June quarter would have been much higher if not for the outflow recorded in May.
The assets under the mutual fund industry were down 2.83 per cent to ₹22.60-lakh crore in May, compared to April.
On the whole, the industry witnessed total net outflow of ₹50,000 crore in May, against a net inflow of ₹1.37-lakh crore in April. The main reason for the downtrend in the AUM can be attributed to the outflow of ₹46,724 crore in the liquid/money market category, against an inflow of ₹1.16-lakh crore in April.
Though SEBI has been advocating a reduction in commission for distributors, the recent sharp rise in the commissions paid to distributors has been worrying investors. In fact, the top 20 distributors, largely dominated by banks, managed 24 per cent of the 43-player mutual fund industry’s AUM as on March 2018.
The recent AMFI data showed that these distributors managed close to ₹5-lakh crore as of March, compared to ₹3.94-lakh crore handled in the same period last fiscal. The mutual fund industry commission payout to distributors was up 70 per cent at ₹8,500 crore in FY18.