Market participants say that going forward, Maharashtra and Delhi will continue to attract more money as institutional and corporates sector are more concentrated in both the states.
In the last one year, the share of the country’s smaller towns or B30 (beyond top 30 cities) have improved for the Indian mutual fund industry. B30 accounted for 15.30% of the total average assets under management (average AUM) as in August 2019, against 14.48% in August 2018. AAUM of Indian mutual funds as on August stood at Rs 25.64 lakh crore, showed data from the Association of Mutual Funds in India (Amfi) collated by rating agency Icra.
The data from Icra showed that Maharashtra’s and New Delhi’s average AUM are at approximately Rs 10.72 lakh crore and Rs 2.23 lakh crore, respectively. Market participants say that going forward, Maharashtra and Delhi will continue to attract more money as institutional and corporates sector are more concentrated in both the states.
“With monthly increase in contribution, Maharashtra continues to be the biggest contributor (41.80%) in August 2019. Despite month-on-month (MoM) fall in average AUM contribution, New Delhi remains the second largest contributor (8.68%). With monthly increase in contribution, third position was clinched by Karnataka (7.27%) and Gujarat held the fourth position (6.97%), despite fall in monthly contribution,” Icra in its press release.
Despite Indian equity markets witnessing volatility in August, equity oriented schemes saw inflows of Rs 9,152.43 crore highest in the current financial year. Net inflows into mutual funds in August was at Rs 1.02 lakh crore, against inflows of Rs 87,087.71 crore in July. G Pradeepkumar, CEO at Union Asset Management Company (AMC), said, “We are witnessing good growth from the B30 cities and in fact around 46% of our folios come from B30 cities. I think steps taken by fund houses, regulators and Amfi has helped industry to tap the B30 market. We have been able to tap the market largely through our banking network.”
Investors have continued to invest in mutual through systematic investments plans (SIPs) and mutual fund industry has added about 9.39 lakh SIP accounts each month on an average in FY 2020. In August, the total amount collected through SIPs was at Rs 8,231 crore lower compared to July when it had seen collection of Rs 8,324 crore. In the five month of current financial year, SIPs contribution was around Rs 41,098 crore, showed the data from Amfi.