The country’s five largest asset management companies have reported a sharp increase in their average assets under management (AAUM) during August.
Data released by the Association of Mutual Funds in India (Amfi) this evening showed that HDFC Mutual Fund’s AAUM rose 12.6 per cent from Rs 83,366.10 crore in July to Rs 93,874.19 crore in August.
The AAUM of Reliance Mutual Fund, the country’s largest fund house, went up by 8.28 per cent to Rs 1,17,313.78 crore at the end of August. HDFC continued to remain the second-largest fund house, followed by ICICI Prudential, which witnessed a growth of 6.32 per cent to Rs 77,966.86 crore in its AAUM.
UTI’s AAUM shot up by close to 10 per cent from Rs 67,251.89 crore in July to Rs 73,925.89 crore in August. The assets of the fifth-largest fund house, Birla Sun Life, increased 9.65 per cent to Rs 62,866.56 crore. While data for all 38 fund houses were unavailable, trends show that the mutual fund industry will be able to surpass the July AAUM of Rs 6,89,946.12 crore.
The surge in assets came despite distributors and independent financial advisors threatening to shun mutual fund distribution after the market regulator, the Securities and Exchange Board of India (Sebi), banned entry load for mutual fund investments. The Sebi move came into effect from August 1.
Sebi also restrained fund houses from charging unit holders different exit loads based on the value of their investments. In simple terms, it asked fund houses not to discriminate between different classes of investors. Fund houses had lined up new fund offers to cash in on the “pre no-load” regime. However, distributors said that none of the NFOs were attracting large investor interest. “Retail investors are still concerned about the sharp run-up in equity markets. Although risk appetite is returning, it is not huge,” said the head of a bank-sponsored distribution house.
Krishnan Sitaraman, head, Crisil Fund Services said, “Since monthly AUM at the end of July was substantially high, the incremental increase in assets may not be that higher.”