Advance tax outflows along with initial public offering (IPO) listings, new fund offers (NFOs) and inflows into debt instruments failed to dampen fund flows into the mutual fund industry in the recent past, according to a Crisil report.
Crisil said that the overall AUM stood at Rs 5.54 lakh crore as on December 2007, up by 71% over the December 2006 AUM of Rs 3.24 lakh crore.
The AUM of December 2007 grew marginally by 2% (or Rs12300.8 crore) over that of November 2007. Nearly half the gains in the overall AUM in 2007 was reported by India?s top five fund houses put together ? Reliance Mutual Fund, UTI Mutual Fund, ICICI Prudential Mutual Fund, HDFC Mutual Fund and Franklin Templeton Mutual Fund. Of India?s 32 fund houses, 21 reported growth in portfolios in December 2007.
Among NFOs launched in December were Franklin Asian Equity Fund, JM Agri and Infra Fund, DBS Chola Small Cap Fund, Kotak Indo World Infrastructure Fund, and Birla Sun Life Special Situations Fund. Reliance Mutual Fund remains the largest fund house with an AUM of Rs 80,800 crore. UTI MF moved up one notch to second place, with an AUM of Rs 56,900 crore, while ICICI Prudential MF was on the third spot with an AUM of Rs 56,800. MFs were net buyers at Rs 3,024 crore in the secondary equity market in December as against Rs 2,169 crore in November.
Among mutual fund regulations announced in December, Sebi has unveiled a draft proposal on real estate investments trusts (REITs). It has waived entry loads on direct mutual fund investments with effect from January 4, 2008. It has also issued a draft proposal for a fast-track launch of mutual fund products and invited comments before January 15. However, the regulator will retain the power to advise amendments to the offer document, if required.
Further, with effect from February 1, investments of Rs 50,000 and more in MF schemes will need to comply with know-your-client norms, the rating agency said.
Crisil said that Union cabinet has approved a proposal to allow UTI Mutual Fund and SBI Mutual Fund to manage post office insurance funds.
