Fund houses paid over 50% more commission to distributors in FY 2021 than in FY 2022, indicates an analysis of commission data released by top five fund houses. As per the commission disclosure made by SBI, HDFC, ICICI Prudential, ABSL and Kotak Mahindra, their total commission outgo towards their top distributors was Rs. 5,133 crore in FY 2022. The figure stood at Rs. 3,384 crore in FY 2021.
Please note that the disclosures do not give a complete picture as they include the payment data to only around 1,500 distributors.
Among the top four fund houses, Kotak Mahindra recorded the highest jump in commission outgo. In FY 2022, the company paid 67% more commission to these top distributors at Rs. 993 crore compared to Rs. 594 crore in FY 2021. SBI recorded a 55% rise in commission payments to top distributors, followed by ICICI Prudential which paid 50% more.
|
Fund House |
Commission outgo FY22 |
Commission outgo FY21 |
Commission outgo FY20 |
Commission outgo FY19 |
|
SBI |
1,372 |
885 |
665 |
838 |
|
HDFC |
914 |
638 |
684 |
971 |
|
ICICI Prudential |
1,242 |
826 |
685 |
1,006 |
|
Aditya Birla Sun Life |
612 |
441 |
495 |
650 |
|
Kotak Mahindra |
993 |
594 |
479 |
468 |
|
Total |
5,133 |
3,384 |
3,008 |
3,933 |
|
Growth (%) |
51.68 |
12.50 |
-23.52 |
— |
*All numbers are in Rs crore except for percentage
Industry insiders say that the rise in commissions is a result of a massive rally in the stock market in FY 2022 and record inflows into mutual funds. Market data shows that Sensex and Nifty rallied over 18% in FY 2022, leading to a 19% rise in industry AUM. The buoyant market also helped the industry add over 1 crore new investors during the period.
The FY 2022 commission payout is highest in the last four years. The previous high was seen in FY 2019 when the top five mutual funds paid Rs. 3,933 crore to their top distributors. The figure declined to Rs. 3,008 crore in FY 2020 and rose to Rs. 3,384 crore in FY 2021 before touching a new high of Rs. 5,133 crore in the last financial year.
