The domestic mutual fund (MF) industry has continued to grow by leaps and bounds even in the current financial year. In the first nine months till November 2002, the net Assets Under Management (AUM) of the industry grew by a massive Rs 20,799 crore — or about 21 per cent — across all classes of mutual funds.According to data released by the Securities and Exchange Board of India (Sebi) on the status of mutual funds for the period of April-November 2002, net AUM of the MF industry jumped sharply to Rs 1,21,392.80 crore as compared to the previous April 2001-March 2002 figure of Rs 1,00,594.19 crore.It is interesting to note that the AUM of the domestic MF industry has grown to the current level from Rs 68,193 crore witnessed in the financial year April 1998-March 1999. Private sector MFs have been the major beneficiaries of the rise in the AUM during the first nine months of the current fiscal, garnering almost 52 per cent of net AUM. These MFs witnessed the highest inflows, to the tune of Rs 21,144.56 crore, during the first nine months of the current fiscal.The interesting point to note about the progress of the MF industry is that the AUM of public sector MFs also grew by 8.57 per cent, garnering Rs 10,399 crore and registering a net inflow of Rs 2,586.42 crore.Said Standard Chartered Mutual Fund managing director Naval Bir Kumar: “The mutual fund has emerged as the best long-term saving instrument. It is proven by the fact that sales continued to rise irrespective of the tax benefits withdrawn from February 2002.” He added: “One of the many reasons for the increase in MF participation is the new innovative products in the market.” “Another advantage with MF is that it meets most requirements like instant redemption and liquidity. Investors can avail the facility even for one, two days or a couple of years unlike other source of parking funds,” he added.The country’s largest MF, Unit Trust of India (UTI), however, continued its woes with the MF witnessing net outflows to the tune of Rs 7,362.31 crore in the first nine months till November 2002 and its AUM shrunk to Rs 45,549.33 crore from the previous figure of Rs 51,433.61 crore as on March 31, 2002. During the period under review, UTI mobilised funds to the tune of Rs 4,379.56 crore while it faced the redemption/ repurchase pressure of Rs 11,741.87 crore. The main reason for UTI facing such a huge pressure for redemption was that the maximum number of its monthly income plans (MIPs) matured during the period under review in the current financial year.Sebi data for the period under review also showed that of the different types of schemes floated by MFs, income/ debt oriented schemes garnered the maximum AUM, followed by growth/ equity oriented schemes. Income/ debt oriented schemes managed AUM to the tune of Rs 92,722.89 crore, while the AUM of growth/ equity oriented schemes was Rs 14,837.67 crore. Balanced schemes came at the lowest end of the table with AUM to the tune of Rs 13,832.24 crore.
