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MF News Close to 40% of the industry’s net inflows come from equity funds in April –June

Close to 40% of the industry’s net inflows come from equity funds in April –June

The quarter ending June 2018 recorded Rs. 51,676 crore of net inflows in equities compared to Rs. 61,561 crore in the preceding quarter.
Shreeta Rege Jul 9, 2018

In the quarter ending June 2018, majority of inflows came in liquid (Rs. 1.21 lakh crore) and equity and related schemes (pure equity, balanced, other ETF, arbitrage and ELSS) (Rs. 51,676 crore) categories. Despite recording positive flows in equities, the quantum of growth has declined compared to January to March 2018 quarter.

Ashutosh Bishnoi MD and CEO, Mahindra MF believes that there is no cause of worry. “The equity market has been volatile in the last few months. In this scenario, some investors are likely to drift away from equity markets to reduce risk. Additionally, with interest rates rising, investors are perhaps moving to interest bearing deposits and other instruments.”

“Furthermore, in periods when market cools off, long-term investors tend to book profits. This could have also resulted in the dip in inflows in the April to June quarter compared to January to March quarter. However, with overall equity inflows over Rs.50,000 crore, I do not see it as a cause of concern,” said Bishnoi.

NS Venkatesh CEO, AMFI sees this as a minor aberration and not a sustained trend owing to market volatility and redemption in arbitrage funds. Venkatesh said, “We are still observing robust SIP inflows predominantly in equities especially from B30 cities. We are confident that SIP inflows will continue to grow.” 

Category-wise, equity, ELSS, balanced and other ETFs recorded positive inflows every month of the quarter, while gilt and gold ETF have seen outflows.

Net inflow/outflow in the last two quarters

 

Quarterly Inflow / Outflow

(April to June 2018)

Quarterly Inflow / Outflow

(January to March 2018)

Equity Schemes

29962

(Excluding Arbitrage Funds)

31041

Arbitrage Funds

535

NA

ELSS - Equity

2219

7274

Balanced

7648

19445

Other ETFs

11312

3801

Gold ETF

-146

-266

Income

-38306

-33389

Gilt

-1370

-3288

Liquid/ Money Market

121866

42796

Fund of Funds Investing Overseas

30

-55

Infrastructure Debt Fund

153

140

TOTAL

133903

67499

Source: AMFI

In terms of AUM, the top three categories in terms of asset size are equity and related categories with Rs. 10.49 lakh crore of assets, followed by income with Rs. 7.61 lakh crore and liquid with Rs. 4.58 lakh crore in June 2018. Income, equity and liquid have held their top positions in term of AUM during the quarter.

Quarter-end AUM in the last two quarters

 

AUM as on June 30, 2018

AUM as on March 31, 2018

Equity Schemes

647659

(Excluding Arbitrage Funds)

669207

Arbitrage Funds

55747

NA

ELSS - Equity

83186

80583

Balanced

174737

172151

Other ETFs

88122

72888

Gold ETF

4567

4806

Income

760715

785553

Gilt

9541

11404

Liquid/ Money Market

457831

335525

Fund of Funds Investing Overseas

1626

1451

Infrastructure Debt Fund

2670

2468

TOTAL

2286401

2136036

 
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