Reliance Nippon Life Mutual Fund has recorded profit of Rs.125.6 crore in April-June 2019 as against Rs.112.6 crore in the corresponding period last fiscal, a growth of 12%, says a press release issued by the company.
An analysis of earnings growth of the fund house shows reduced expenses incurred on distribution has helped the fund house report strong earnings. Regulatory changes such as banning upfront commission and asking AMCs to pay commission from the scheme instead of AMC book have helped fund houses reduce their expenses incurred on distribution commission.
The AMC incurred expenses worth Rs.25.2 crore as fees and commission in Q1 FY 2019-20, 62% lower from Rs.66.7 crore in the corresponding period last year.
In addition, increase in equity assets led to a rise in the AMC’s profit. The AMC’s equity assets (including ETFs) grew by 19% year-on-year to Rs.1.2 lakh crore in June 2019. Equity assets as a proportion of mutual fund AUM grew to 42% as on end of June, from 37% a year ago. The AMC has around 32 lakh SIP folios, with annualised book of Rs. 10,300 crore as on June 2019.
Reliance Nippon Life MF manages AUM of Rs.2.20 lakh crore as on June 2019.
Overall, the AMC has AUM of Rs.4.30 lakh crore across all business, which include PMS, AIF and offshore advisory services among other things.
Recently, HDFC AMC has posted 42% growth in its profit from Rs.205 in Q1 FY 2018-19 to Rs.292 crore in Q1 FY 2019-20.
