AUM in T30 cities increase by 27%

The assets from the top 30 cities increased by 27% in the past one year, shows AMFI’s quarterly geographical data. The total AUM from T30 cities stood at Rs.18.75 lakh crore, as on December 2017, which accounts for 88% of the total MF AUM. The total AUM in T30 cities was Rs.14.81 lakh crore in December 2016.

The financial capital, Mumbai, continued to remain at the top spot with the highest AUM. The AUM of Mumbai registered an increase of Rs.1.02 lakh crore in one year to reach an AUM of Rs.8.13 lakh crore in December 2017. Mumbai also witnessed the highest absolute change in AUM. Experts attributed the phenomenal growth to market gains, higher financial literacy and institutional presence.

Delhi followed Mumbai with AUM of nearly Rs.3 lakh crore that accounted for 14% of the total MF AUM.

Among the top five, Chennai overtook Bengaluru for the third spot. Chennai recorded AUM of Rs.1.50 lakh crore, which is 7% of the total MF AUM. In percentage terms, Chennai witnessed the highest growth in assets, at 77%, by adding Rs.65,404 crore in one year.

Chennai-based AK Narayan, of AK Narayan Associates, said that investors in Chennai are moving away from traditional investment options to mutual funds. “Earlier investors were conservative and invested in gold, real estate and fixed deposits. Investors are now shifting to equity mutual funds due to lacklustre performance of physical assets,” he said. 

Beyond the top five cities in the T30 category, Pune witnessed the highest growth in its AUM. The assets of Pune increased by 33% or Rs.19,130 crore to Rs.77,411 crore in December 2017.

In percentage terms, Coimbatore witnessed the highest increase in AUM, barring the top five. It saw a growth of 85% in its AUM, to Rs. 9,145 crore, in December 2017 as against AUM of Rs.4,939 crore in December 2016.

A Coimbatore-based distributor (pleading anonymity) attributes this to one individual investor. “The huge increase in the AUM is due to the investment of one particular individual. He invested around Rs.1,500 crore. If you remove this number, the growth in AUM will not be significant,” he said. 

Though the AUM of the top 30 cities has increased, it witnessed a fall in percentage terms. The total percentage share of the T30 cities has decreased marginally from 89.98% to 88.16%. Experts attributed it to the overall increase in MF AUM and the growing popularity of mutual funds in smaller cities.

AMFI data shows that assets from B30 locations grew from Rs.1.65 lakh crore in December 2016 to Rs.2.52 lakh crore in December 2017. The rate of growth in assets for B15 locations was 53% while the industry grew at 27%. Overall, B15 assets account for 11.84% of industry AUM. 

Recently, SEBI revised the definition of top cities and beyond top cities for additional TER. Now T15 and B15 have become T30 and B30.

AUM of the top 30 cities

(In crore Rs)

Source: AMFI