‘AUM of mutual funds to rise by ₹2-lakh crore’

Our Bureau Mumbai | Updated on January 17, 2021

A. Balasubramanian, MD, Aditya Birla Sun Life AMC   -  Bijoy Ghosh

Indian markets likely to attract $35 b FPI money in next 2 years

Aditya Birla Sun Life Asset Management Company expects asset under management of mutual funds to increase seven per cent by March-end to ₹32 lakh crore from ₹30 lakh crore logged in December.

The increase in AUM of mutual funds will be aided by gain in assets held and increased inflows due to excess liquidity in the system.

Equity flow to rise

A Balasubramanian, Managing Director, Aditya Birla Sun Life AMC, said the equity inflow would touch ₹14 lakh crore this year from ₹11 lakh crore logged last year due to huge profit reaped by investors in the last few months.

Birla Mutual Fund targets to enhance its systematic investment book to ₹1,000 crore a month in this year from current level of ₹850 crore and inch up from being the third largest fund house in terms of inflows through systematic investment plan, he added.

The AUM of Birla Mutual Fund has jumped to ₹2.55 lakh crore as of last month from ₹2.14 logged in June.

The fund house has surpassed its target to add 15 lakh new customers every year by bringing in 18 lakh customers last year. It has set an ambitious target to enhance branch presence to all the 543 political constituency from the current level of 320 branches.

Easy liquidity

Mahesh Patil, co-CIO, Aditya Birla Sun Life AMC, said the global and Indian markets have crashed 35-40 per cent due to Covid but has recovered smartly to hit an all-time high with the vaccine launch.

Chasing risky assets, the excess liquidity in global markets available at almost zero per cent interest rate are expected to result in inflow of $350 billion into emerging markets over next two years and India being the most favoured would receive about 10 per cent of the inflow, he said.

Betting on earnings

Going ahead, markets will be driven by revival in corporate earnings ,which are just entering into long term upcycle. Economic activities across most sectors have bounced back to pre-Covid level and the efficiency improvement adopted by corporates due to Covid will add to their bottomline by bring down the cost.

The major reforms announced by the government and performance linked incentives should attract foreign direct investment.

The drastic fall in bad assets of banks and lower lending rates should push up credit growth in near future, said Patil.

Published on January 07, 2021

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