After two quarters of decline,the average assets managed by the mutual fund industry surged by 6% to Rs 7.43 lakh crore, even as the country's largest fund house Reliance MF saw a drop in its AUM.
The industry comprising 43 active players witnessed a surge in their average assets under management (AUM) by Rs 42,546 crore or 6.07%, as per the data available with industry body Association of Mutual Fund Industry (AMFI).
The combined average AUM of the 43 fund houses stood at Rs 7,43,083.91 crore at the end of June 2011, up from Rs 7,00,537.7 crore in end-March.
At the end of June, the AUM of the largest MF in India Reliance MF witnessed a fall of Rs 317 crore to Rs 1,01,259.33 crore.
The country's second largest fund house HDFC MF witnessed a near 7% jump in its AUM at Rs 92,033 crore. Besides, ICICI Prudential MF's assets gained 8.57% to Rs 79,760 crore during the April-June period.
Besides, UTI MF saw an increase of Rs 1,916 crore or 2.85% to Rs 69,105 crore in end June. As many as 32 fund houses saw an increase in their AUM figures.
Industry players said a good quantum of inflows into fixed maturity plans (FMPs) helped the industry to record an increase in the AUM, even as equity markets continue to remain under pressure.
"With interest rates going up, it has helped the industry to garner flows into FMPs, short term debt and money market instruments. Also retail participation has increased," SBI MF Chief Marketing Officer Srinivas Jain said.
The industry has seen an AUM decline of 5% in December quarter and 2% in March quarter.
Among the other players, SBI MF witnessed a hefty 15% jump in AUM to Rs 47,874 crore. The AUM of Edelweiss MF increased by 42%, Fidelity MF by 3% and that of IDBI MF by 44%.
Industry players are expecting an upturn in the coming days pursuant to the government allowed foreign investors, other than FIIs, to invest up to $10 billion in domestic mutual funds.
They said if the government simplifies the registration process and know your customer (KYC) norms for such investors, the fund flow would increase.
"Such funds would broaden the AUM base and increase participation in MF," Jain added.
During the April-June quarter, the 11 fund houses that saw their average assets dwindle include Axis MF (drop of 10% to Rs 7,453 crore), LIC MF (decline of 17% to Rs 9,338 crore), DSP BlackRock MF (drop of 2 pc to Rs 30,021 crore) and Morgan Stanley MF (decline of 1% to Rs 2,052 crore).
