Mutual fund assets under management touch new high of Rs 31.4 lakh crore

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By Express News Service

NEW DELHI:  The mutual fund industry has been on a significant growth path over the past decade, going by its assets under management. Data from the Association of Mutual Funds in India (AMFI) shows, industry assets grew 41 per cent in the last financial year to touch a new high of Rs 31.4 lakh crore.

The growth was primarily led by an increase in AUM of equity funds (Rs 4.09 lakh crore), income funds (Rs 2.39 lakh crore) and other ETFs (Rs 1.29 lakh crore).

According to the Fund Folio report from Motilal Oswal Financial Services, Equity AUM, including ELSS and index funds, of domestic mutual funds reached new highs of Rs 10.2 lakh crore (up 67 per cent YoY) in FY21, led by a rise in market indices.

“The year saw a decline in sales of equity schemes (down 7 per cent YoY to Rs 2.3 lakh crore). The pace of redemptions picked up to Rs 2.65 lakh crore (up 64 per cent YoY), leading to the first ever net outflows in seven years at Rs 34,700 crore in FY21,” it said. FY21 saw a notable change in the sector and stock allocation of funds.

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The weightage of domestic cyclicals increased by 160 basis points to 58 per cent, led by an increase in the weightage of automobiles, NBFCs, cement, real estate, chemicals and infrastructure. Technology saw a massive rise in weightage in FY21 to 11.9 per cent (up 300 bps YoY). The sector is now the second in terms of sectoral allocation by MFs.

Meanwhile, the newer fund houses have been able to garner a larger share of equity assets, while the older ones have collected more of debt investments. SBI MF, Kotak Mahindra, ICICI Prudential and Aditya Birla Sun Life AMC have seen a sharper growth in equity assets as on February 2021, while Nippon and IDFC are among the ones with higher debt assets.

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