The redemption pressure due to profit booking by the investors, starting up of the tax season and a high market volatility were the main reasons for the 5% dip in the Asset Under Management (AUM) of the Mutual Fund (MF) industry. The AUM of the Indian MFs reduced by Rs 27,716 crore to stood at Rs 5,10,095 crore as on December 31, 2007 compared to the previous month.
However, the MF industry has added 58.68% or Rs 1,88,627 crore in its AUM in the calendar year 2007. The AUM went up from Rs 3,21,468 crore in December, 2006 to Rs 5,10,095 crore in December, 2007.
According to the data provided by Association of Mutual Funds in India (Amfi), the private sector fund house, Reliance Mutual Fund (RMF) has retained its numero uno position in the industry. Its AUM went up by 3.88% or Rs 3,015 crore at Rs 80,779.83 crore in December.
Interestingly, UTI Mutual Fund?s AUM went up by 8.96% or Rs 4,674.31 crore at Rs 56,854 crore and it emerged as a number two player pushing ICICI Prudential Mutual Fund to the third slot. ICICI Prudential MF?s AUM has gained 3.4% or Rs 1,868.52 crore to Rs 56,772.58 crore in December.
Commenting on dip in MF industry?s AUM, Devendra Nevgi, CEO, Quantum Mutual Fund said that the tax season has started because of which the investors have involved in the re-adjustment of their portfolios. Second, there has been some profit booking by the investors as the market has been trading at the high level.
Regarding high rise of AUM of the MF industry, he said, that one of the important reasons for the rise in AUM was the overall good performance of the equity markets. In December 2007, the 30-share Sensex of the Bombay Stock Exchange (BSE) has gained 923 points or was up by 4.7% at 20,286 points while the broader 50-stock S&P CNX Nifty of the National Stock Exchange (NSE) gained 376 points (up 6.5%) to close at 6,138 points.
Another fund house HDFC MF has also maintained its fourth position. The AUM of HDFC Mutual Fund went up by 3.87% or Rs 1,808.73 crore at Rs 48,560.60 crore in December. Similarly, the AUM of Franklin Templeton Mutual Fund went up by 1.31% or Rs 402.42 crore to Rs 31,175 crore.
