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Growing awareness about mutual funds and the ease of transactions through digital push led Nippon India Mutual Fund's investor accounts surge to nearly 2 crore in FY23, making it the largest fund house in terms of folio count, its CEO Sundeep Sikka said.
The fund house has seen consistent growth in its folio count over the last two financial years (FY 21 to FY23) as it added 96.42 lakh investors' accounts during the period and in the past fiscal only, it added 26.2 lakh folios, according to a data compiled by the Association of Mutual Funds in India (AMFI).
On folio count, the numbers have increased from 99.82 lakh in March 2021 to 1.7 crore in March 2022 and finally 1.96 crore in March 2023, the data showed.
Sikka, who is the CEO of Nippon Life India Asset Management Company, said that the acceptance of mutual funds as an investment product, along with digital push, have fuelled the growth in folio count.
"We are retail-oriented mutual funds and our focus has always been retail. In this industry, AUM (assets under management) is very important but for financial inclusion, getting retail investors is very important. These investors are coming from across the country and even in states such as UP, Bihar and Assam, we have our investors," he told PTI.
Market leader
Nippon India Mutual Fund (NIMF) is the comfortable leader when it comes to both addition as well as total number of folios in FY23. ICICI Prudential MF scored the second position by adding 19.21 lakh folios in the last fiscal that took the total count to 1.66 crore. This was followed by HDFC Mutual Fund which added 15.14 lakh folios to 1.14 crore, SBI Mutual Fund added 14.08 lakh folios to 1.22 crore and Kotak Mahindra Mutual Fund added 8.95 lakh folios to 64.7 lakh.
Overall, the 42-player mutual fund industry has added 1.62 crore folios in the 2022-23 to a total of 14.57 crore in March 2023 from 12.93 crore in March 2022.
Folios are numbers designated to individual investor accounts. An investor can have multiple folios.
Focus on small cities/towns
According to Sikka, most of Nippon India Mutual Fund's investors are in the retail category and the company's focus is on small cities and towns.
With an assets under management of Rs 2.93 lakh crore as of March 2023, Nippon India Mutual Fund (NIMF) is among the top five mutual funds in the country.
Sikka said the company, which focuses on small towns, gets 19 per cent of its AUM market share from B30 cities (places beyond the top 30 cities), which is higher compared to 16 per cent for the industry average.
"It is heartening to see growth in the folio numbers and AUM as we are not a bank sponsored asset management company," he said.
The fund house continues to strengthen its brand, and is supported by a wide product basket, strong risk management process and experienced research team, Sikka said.
Digital platforms gaining traction
Apart from traditional avenues, NIMF business is gaining traction on its digital platforms with digital contributions to the company's business transactions rising to 53 per cent.
Reliance Mutual Fund was renamed as Nippon India Mutual Fund in 2019 following the acquisition of Reliance Capital's asset management arm by Japanese insurer Nippon Life Insurance Company. Now, NIMF is the largest foreign-owned AMC in India, wherein Nippon Life Insurance Company holds 73.66 per cent stake.
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