MFs' AUM grows 14 pc to Rs 13.53 lakh cr in FY16

New Delhi: Mutual fund industry's asset base surged 14 per cent last fiscal to Rs 13.53 lakh crore, mainly on account of huge inflows in equity schemes and strong participation from smaller towns.

Given the sluggish trend in the real estate market, mutual fund (MF) houses are expecting to attract a larger share of the Indian households' savings in the current fiscal 2016-17 as well.

In the 2015-16 fiscal, ended March 31, the country's 43 fund houses together saw their assets under management (AUM) increase to Rs 13.53 lakh crore from Rs 11.88 lakh crore in the preceding fiscal, according to data released by the Association of Mutual Funds in India (Amfi).

Of the 43 fund houses, 32 MFs witnessed growth in their assets base, while the remaining 11 saw a preceding in their AUMs.

Among the top five players, ICICI Prudential MF has an assets base of Rs 1,75,881 crore (excluding Fund of Funds) followed by HDFC MF (Rs 1,75,779 crore), Reliance MF (Rs 1,58,408 crore), Birla Sun Life MF (Rs 1,36,503 crore) and SBI MF (Rs 1,06,781 crore).

ICICI Prudential MF has as an AUM of Rs 1,75,964 crore (including Fund of Funds), while HDFC MF has an assets base of Rs 1,76,186 crore.

UTI MF moved out of the top five asset management companies. It has an assets base of Rs 1,06,309 crore.
Growing participation from retail investors, especially from small towns, huge inflows in equity schemes and several measures taken by Sebi has led to a sharp increase in the industry's assets base, market experts said.

The regulator has given extra incentives for those expanding into smaller cities.

"Markets being choppy, retail investors identified mutual funds as a preferred vehicle for investing in market-linked securities.

Equity has performed well as compared to other asset classes, retail investors having flavour for equity have come onboard through the mutual fund route," said Dinesh Khara, Managing Director of SBI MF.

Besides, mutual funds added 53 lakh investor accounts in the just concluded fiscal, taking the total number of folios to a record 4.7 crore.

MFs reported a net inflow of over Rs 75,000 crore in equity and equity-linked savings schemes and smaller towns have contributed 44 percent to such inflows.

The preceding fiscal, however, saw some exits in the MF space and those which have exited include Goldman Sachs MF and JP Morgan MF.

MFs are investment vehicles made up of a pool of funds collected from a large number of investors and invest in stocks, bonds and money market instruments, among others.