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SBI Mutual Fund has emerged the first fund house to have Assets Under Management (AUM) of over ₹6-lakh-crore. It reached the milestone in August thanks to the relentless run-up in the equity market and New Fund Offers (NFOs).
SBI MF collected a whopping ₹15,000 crore from over four lakh investors through its Balanced Advantage Fund NFO of last month.
Supported by the distribution channel, parent State Bank of India’s (SBI) countrywide network of branches, and consistent performance, the fund house managed to attract investor interest even as direct equity investment is gaining ground with opening of record number of new demat accounts.
SBI Mutual Fund has been the industry leader the last few years and topped the list with an average AUM of ₹5.23- lakh crore in the June quarter, followed by HDFC MF and ICICI Pru MF neck-to neck with AUMs of ₹4.16-lakh crore.
Other fund houses
Aditya Birla MF and Kotak MF had AUMs of ₹2.75-lakh crore and ₹2.46-lakh crore, respectively, in the June quarter while Nippon India MF managed ₹2.40 lakh crore. DP Singh, Chief Business Officer, SBI Mutual Fund, said the growth in AUM is supported by a strong rally in the equity market and the exceedingly good response for its products due to consistent performance and the strong distribution network. The mop-up from the Balanced Advantage Fund NFO was a bonus, he added.
The fund house has taken a conscious decision to come out with solution-oriented products rather than playing to the market trend with confusing schemes.
Today, SBI MF serves 1 crore investors and has the highest equity category asset of about ₹3.80-lakh crore (including ETFs), Singh said. The fund house’s equity AUM was ₹3.04- lakh crore in July.
SBI MF also has a strong presence in passive funds with an AUM of ₹1.5-lakh crore.
Strong & steady inflows
ICICI Direct, in a research report, observed that equity funds have been seeing consistent inflows since March. July saw record inflows on the back of NFOs.
“Inflows from March to July were ₹51,200 crore. Outflows from equity funds totalled ₹47,000 crore from July 2020 till February 2021.
“...We believe that as equity markets have been stabilising post one year of Covid-19 induced volatility, inflows will be more structural here on and will provide domestic liquidity support for the equity market,” the report said.
Benchmark Sensex gained 578 points in August to 58,130 against 57,552 in July. Foreign portfolio investments in the equity market hit ₹2,083 crore against outflows of ₹11,308 crore in July.
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