The Hindu Business Line : MFs asset base drops 6% in June

Mumbai, July 2 Assets Under Management (AUM) of mutual funds dropped by around 6 per cent in June, as equities suffered heavy erosion in values during the month. The benchmark BSE Sensex lost more than 2600 points during the month.

Out of the 31 funds, which have released their figures today, five of them led by ICICI Prudential have bucked the trend.

AMFI data

The asset base of the MF has registered a fall of 5.86 per cent in June compared with an increase of 5.36 per cent reported in May. The industry now manages Rs 5,56,103.17 crore in assets as on June end compared with Rs 6,00,266.32 crore in May, according to the data released by the Association of Mutual Funds in India.

“This dip in the asset base is quite modest considering that the markets had fallen substantially last month and in addition there would have been advance tax payments and redemptions,” said Mr Dhirendra Kumar, Director, Value Research.

“The concentration of assets under management is more towards liquid and cash assets, and so the mutual funds were more or less cushioned against the markets falling substantially,” said Mr Vivek Prasad, Partner, Price Waterhouse.

Fund positions

ICICI Prudential Mutual Fund, which has registered an increase of 0.7 per cent in the month of June, manages an asset base of Rs 59,473.58 crore. Reliance Mutual Fund, even while it continues to be at the top, recorded a decrease in its asset base by Rs 7,617 crore, a fall of around 7.7 per cent. It now manages an asset base of Rs 90,813.45 crore compared with Rs 98,430.30 crore in May.

The asset base of HDFC Mutual Fund too fell by 6.05 per cent and the AUM of the mutual fund house now stands at Rs 52,710.80 crore. While UTI continues to be in the fourth position, its asset base fell by 7.10 per cent and Birla Sun Life registered a nominal fall in their asset base by 0.84 per cent. A large part of the assets under management was invested into the fixed income assets, wherein a major part consisted of liquid portfolios, and this cushioned the mutual funds against the fall in the market,” said Mr Ramkumar K, Head-Fixed Income, Sundaram BNP Paribas Mutual Fund.

We also have to understand that the increase in the asset base of the mutual fund industry in the past couple of months has not been much and, against this, the decrease in it is also not very substantial,” said Mr Ramkumar. Out of the total 35 mutual fund houses, 26 fund houses have registered a fall in their asset base, while five have noted an increase in their asset base. (While the data for two fund houses was not available, the other two have not started operations).

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