Pru ICICI AUM surges Rs 142 cr in Sept

Laxmikant Khanvilkar & Vijay Trivedi

Mumbai, Oct 17: While most of the private sector mutual funds (MF) with foreign partners have witnessed heavy redemptions during the last two months and have succumbed to the reeling economical and redemption pressure, Prudential ICICI has witnessed a surge of Rs 141.95 crore (or 2.2 per cent) in its assets under management (AUM) during September. The total AUM of PruICICI MF as on September 31, 2001 stood higher at Rs 6,548.40 crore from Rs 6,406.45 crore in August 2001.

On the other hand, during September 2001, the AUM of some 10 other such funds dropped between 17.5 per cent to 3.1 per cent. For example, Alliance MF saw the highest redemption of Rs 614.54 crore. Its AUM at the end of September 2001 was at Rs 2,881.46 crore (Rs 3,496 crore in August 2001).

Even the domestic MF behemoth, Unit Trust of India (UTI) (though not in the private sector), has witnessed a sharp decline in AUM of Rs 3,842 crore (7.24 per cent) in all its schemes. Accordingly, the Trust’s total AUM has declined in September 2001 to Rs 49,213 crore from Rs 53,055 crore in August 2001.

According to the Association of Mutual Funds of India (Amfi), the AUM of all MFs (other than UTI), too, have declined in September 2001 by Rs 3,683 crore to Rs 42,598 crore from Rs 46,281 crore in August 2001.

Speaking to The Financial Express, Prudential ICICI sr vice-president & head (sales & distribution) Pankaj Razdan said: "This has been possible due to the prudent fund strategy that revolves around risk aversion vis-a-vis credit quality, price and liquidity factor."

Prudential ICICI, with some 12 schemes, has invested around 85 per cent of the total corpus in corporate debt, government bond and commercial papers. This, says Mr Razdan, ensures relatively risk-free returns besides investments remaining safe, while, the balance 15 per cent of the corpus is invested in equities.

Also he claims that the two part policy of the portfolio liquidity — the high level of liquidity with low risk — has made it one of the preferred choice for investments with constant returns and better liquidity.

Lastly, Amfi’s statement indicates that income funds in the MF industry have witnessed more redemptions during September than in the growth funds. Accordingly, the AUMs of all the income funds has shrunk to Rs 51,359 crore in September from Rs 56,200 crore in August.