Comments
Equity mutual funds witnessed a net inflow of ₹6,657 crore in March, a plunge of 59 per cent from the preceding month, due to volatile stock markets along with profit-booking by investors to avoid payment of LTCG tax.
According to a report by rating agency Icra, equity funds, including equity-linked saving schemes saw monthly net inflow of ₹6,657 crore in March, down from ₹16,268 crore infusion seen in February.
“The fall could be due to volatile equity markets and profit-booking by investors to avoid paying long-term capital gains (LTCG) tax before the new tax rules came into effect from April 1, 2018,” the report noted.
Finance Minister Arun Jaitley, in his budget speech, had announced LTCG tax of 10 per cent on equity gains beginning February 1, 2018 on gains exceeding ₹1 lakh. Later, the government clarified that the proposed LTCG tax on equity holdings will apply on profits made from sale of shares on or after April 1, 2018.
Despite the volatility, equity funds saw robust net inflow of ₹1.71 lakh crore in the gone-by fiscal. In the eleven-month period ended February, 2018, cumulative Systematic Investment Plan (SIP) contribution was ₹ 60,071 crore.
Overall, mutual fund schemes saw a net inflow of ₹2.72 lakh crore in 2017-18, much lower than ₹3.4 lakh crore seen in the previous financial year.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.