With the booming stock market remaining volatile in the recent times, more and more investors are seeking mutual fund (MF) route to invest in the market. This can be seen from the number of investor folios rising faster than the growth in asset under management (AUM) of the MF industry. For the financial year ended March 31, 2008, the number of investor folios of the MFs stood at 4.37 crore, which was at 2.79 crore as on January 31,?07. This represents growth of almost 57%. During the same period, the AUM of the Indian MFs increased 54%, from Rs 3.29 lakh crore to Rs 5.05 Lakh crore.
As per the latest data available with Sebi with respect to different categories of MF investors and their share in total AUM, the share of individual investors has remained more or less static at 42.35% (against 43% as on March 2006), while that of NRI Investors stood at 5.34% (previous 5%) as on January 2007. While the share of foreign institutional investors and Corporate investors has undergone some significant change during the same period. The share of FIIs in MFs AUM has increased from 1% to 2.37%, while that of corporate has come down to 49.94% from 51%. These figures are expected to see major changes once the regulator is able to collate the numbers for the year ended March 31, 2008..
Dhirendra Kumar, director, Value Research Online, said, ?This is a positive sign for the MF Industry in the country and very important for the growth of the industry. The boom in the MF sector can be attributed to the boom of equity markets in the year 2007. Last year?s bullish run in the share market is one of the important part of success of New Fund Offering due to which large numbers of investors were attracted to invest in it.?
The rise of MF industry in India can also be seen by the number of distributors, which stands at 72,108, excluding 107 banks, till March?08 compared to around 54,000 in January?07. Sebi has recently cleared a proposal to allow asset management companies to launch real estate mutual funds which will be entering the market soon and will require special set of people to market the same. As a result, by the end of the year number of distributors may increase.
