The mutual fund industry, which boasts of assets of nearly Rs 7 lakh crore, has aggressive plans to reach out to the vast number of untapped potential investors. The soon-to-be-launched campaign will see it demystify capital markets and mutual fund industry in investors’ mind.
The Association of Mutual Fund Industry (AMFI) is to come out with its media campaign soon, perturbed by the fact that amid the growth of other financial investment products, growth of mutual fund industry has more or less remained stagnant.
AMFI, is the umbrella body representing over 40 asset management companies (AMCs).
AMFI had earlier planned to launch its media campaign during the first few months of the year, but given the on-going cricket world cup, which will be quickly followed by the Indian Premiere League (IPL), it postponed the launch till the completion of the IPL.
“The advertisement campaign will purely be from the AMFI’s side. It will not be fund or scheme specific. We will focus on mutual funds as a product and will try to demystify what a mutual fund is, so that we can bring more investors in the forum. We had planned to launch this on the television, but because of the world cup followed by the IPL, we realised that this is not the right time to go ahead with the launch. After the IPL, we would come out with our media advertisement,” said an AMFI official.
So far, individual fund houses have been advertising their products through print and electronic media but in vain. “We have all along been concerned with a major issue of how to grow the market. Across the financial services sector, products such as insurance and those offered by banks have grown. But mutual fund industry is more or less static. In fact, it has de-grown if we consider by the assets under management over the last two years,” the official added.
Out of the over 100 crore population, “we have less than a crore unique mutual fund investors. Though potential is enormous, how to reach out to these people and sell them the product is essentially an issue. Moreover, issue is largely around the retail participation and that too around the equity segment,” he said.
After the entry load ban by the Securities and Exchange Board of India (Sebi), fund industry continued to bleed, as it could not garner fresh assets in the equity class. The MFs continued to lose number of investors which impacted the equity assets too. As on February, the equity asset under management has reduced to below Rs 2 lakh crore against the overall industry’s assets of close to Rs 7 lakh crore.
“Through our campaign, we need to make investors understand that this is not a race-course. If you (investors) have additional disposable surplus which can garner better returns, one should look at mutual fund as an asset class,” the official further added.
