Top 15 AMCs constitute 95% of the total industry folio

The Rs19 lakh crore mutual fund industry is getting concentrated in favour of the large fund houses.

An analysis of the folio count of individual fund houses shows that the top 15 AMCs constitute 95% of the industry’s total folio. The total folio count of these fund houses grew 25%, from 4.22 crore in FY 2015-16 to 5.29 crore in FY2016-17, an increase of over 1.07 crore folios in a year. The total folio count of the MF industry stood at 5.55 crore, as on March 2017.

In 2015-16, the top 15 AMCs constituted 88% of the total industry folios.

Experts attribute the increase in folios of the top fund houses to their strong presence in B15 citiesthrough national distributors. “The top fund houses have better reach compared to emerging fund houses. Almost all large banks sell their schemes in the B15 market. Also, most of the large fund houses have banks as their sponsors. In addition, fund houses give higher commission to the distributors who sell their schemes in smaller cities,” says Mumbai-based Vinod Jain of Jain Investments.        

Seconding Vinod’s view, Nisreen Mamaji of MoneyWorks Financial Advisors,says, “Some of the funds of the top fund houses have been around for a very long time. As they have a longer track record, it is easier for us to analyse these funds and recommend it to our clients. Moreover, we have regular interaction with the top fund houses as they brief us on the key trends and developments impacting our clients’ portfolios.”

Vidya Bala, Head of Mutual Fund Research, FundsIndia, feels that increasing awareness of mutual funds has helped fund houses to increase their folio count. “In 2016, we have seen the number of individual folios crossing the 2008 numbers. What has changed over these years is the effort of the industry to spread awareness about mutual funds. In addition, many retail investors are gaining confidence in mutual funds considering the good performance of various schemes,” says Vidya.

Among the top 15 fund houses, UTI Mutual Fund retained the number one spot. Its folio count grew to 1.07 crore in FY16-17 from 1.05 crore in FY15-16.

Birla Sun Life Mutual Fund witnessed the highest increase in its folio count. The fund house saw an increase of more than 10 lakh folios in FY 2016-17, i.e., from 29 lakh folios in March 2016 to 40 lakh folios in March 2017.

ICICI Prudential Mutual Fund saw the second highest growth in folios in absolute terms as its folio count grew from 40 lakh to 49 lakh in a year, an addition of 9.44 lakh folios.

Reliance Mutual Fund followed ICICI Prudential Mutual Fund with an addition of 9.22 lakh folios. In terms of size, Reliance Mutual Fund has 68 lakh folios, which is the second largest fund house in terms of totalfolio count.

In terms of growth in percentage, Kotak Mahindra Mutual Fund saw the highest growth of 37% or an addition of 3.20 lakh folios last fiscal. The total number of folios of the fund house increased to 12 lakh in March 2017.

Folio growth of top 15 AMCs

Figures in absolute terms