The annual April factor that sees institutional money coming back to mutual funds after a March lull and an improved market scenario that raised the retail participation together helped the mutual fund industry gain significantly in terms of the assets under management (AUM) in the past month.
The AUM for the industry rose by 11.7 per cent or Rs 58,000 crore in April, the highest single-month gain since October 2007, to touch a nine-month high AUM of Rs 552,006 crore.
“While institutional money has come very fast in April, we have seen a lot of retail participation which has increased significantly with improved investor sentiment as a result of the rising markets,” said Sundeep Sikka, chief executive officer, Reliance Capital AMC.
Having lost almost Rs 7,700 crore in March under pressure from banks and institutions that pulled out their money as a routine that they follow in the last month of every fiscal year, mutual funds saw a huge inflow of funds from the institutions in April.
The top six fund houses contributed 63 per cent of the total industry gain. Reliance Capital AMC led from the front as it mopped up assets amounting to Rs 7,425 crore. HDFC Mutual Fund and UTI AMC followed with gains of Rs 5,924 crore and Rs 5,736 crore respectively.
With the benchmark Sensex gaining nearly 50 per cent since March 9 and the surge in AIM has boosted the morale of market players.
Mutual funds filed for six new equity schemes with the Securities and Exchange Board of India (SEBI) in April.