LIC Mutual Fund (LICMF), which with a growth rate of 150 per cent became the fastest-growing large fund last month, lags all major fund houses on growth of its equity fund portfolio. It now plans to increase its focus on the equity fund management.
While the equity assets under management (AUM) for the industry stand at 21 per cent of the total AUM, LICMF has only 3.8 per cent of its total AUM under equity schemes.
This is the lowest equity exposure among the top 10 fund houses.
“Traditionally, we have been focusing on the debt side,” said Sushobhan Sarker, director and chief executive officer, LIC Mutual Fund. “But now we are focusing on the equity side too. We have tried to strengthen our equity team and have hired a top fund manager for to deliver the returns.”
With assets of Rs 42,646 crore in August 2009, LICMF has grown by 150 per cent over its August 2008 figures. In the process, it has become the sixth largest fund house, from 11th.
However, the fund’s equity AUM have declined from 10.6 per cent of the total AUM in August 2008 to 3.8 per cent in August 2009.
LICMF is not alone. All fund houses witnessed a decline in equity AUM as a percentage of their total AUM because of the high inflow of institutional money into debt funds. But while other fund houses managed to see some inflow into their equity funds, LIC has not been able to increase its equity AUM.