Smaller towns’ asset base surged to Rs 4.27 lakh crore in 2017-18, up 38 per cent from the preceding financial year, due to a spirited investor awareness campaign by the industry and strong participation from retail investors. Harsh Jain, COO at Groww, an online mutual fund investment platform, attributed the impressive surge in asset base to investor awareness campaign by the industry. Besides, an aggressive role played by mutual fund distribution platforms, demonetisation effect and strong participation from retail investors helped in the rise of asset base in smaller towns, also called B15 locations, he added.
Moreover, investors are now shifting from traditional asset classes such as real estate and gold to financial asset class. Mutual funds’ assets under management (AUM) from B15 locations soared by Rs 1.2 lakh crore, or 38 per cent, to Rs 4.27 lakh crore in 2017-18 from Rs 3.09 lakh crore in the preceding fiscal, latest update with Association of Mutual Funds in India (Amfi) noted. Overall, the industry’s AUM, comprising 42 active players, surged 26 per cent to Rs 23.05 lakh crore in March-end. Currently, B15 towns account for nearly 19 per cent of the total assets of the industry.
About 62 per cent of the assets from B15 locations is in equity schemes, while the same is 36 per cent for top-15 cities or T15. B15 cities are those which are beyond the top 15 cities namely New Delhi (including NCR), Mumbai (including Thane and Navi Mumbai), Kolkata, Chennai, Bengaluru, Ahmedabad, Baroda, Chandigarh, Hyderabad, Jaipur, Kanpur, Lucknow, Panjim, Pune and Surat. About 10 per cent of the retail investors chose to invest directly, while 18.4 per cent of HNI assets were invested directly.
“Besides, 40.7 per cent of the assets of the mutual fund industry came directly. A large proportion of direct investments was in non-equity oriented schemes where institutional investors dominate,” Amfi noted.