June turned out to be a bad month for the mutual fund industry as the total average assets under management, or AUM, for the month went down by 6 per cent over May. The total AUM, which averaged a tad above Rs 6 lakh crore in May, has fallen by about Rs 36,000 crore through June.
Majority of the fund houses including market leader Reliance capital Asset management witnessed erosion in their assets under management.
On the brighter side the fall of 6 per cent is much less than the 16 per cent plunge in the value of the 30-share Sensex of the Bombay Stock Exchange in June. The stock market has seen sustained downslide as investors turned jittery with a sharp spike in inflation and heightened worries about economic growth.
“Banks pulled out money from the liquid funds because of the advance tax requirements coupled with the quarterly closing,” said Jaideep Bhattacharya, chief marketing officer, UTI AMC. “On the equity front, there was no redemption pressure but the new money kept away because of the volatility.”
Only five of the 31 fund houses, for which data were available, showed an increase in their AUM.
ICICI Prudential AMC, the second largest of them, is the only among the top five players that witnessed a rise in its AUM, though marginally by 0.7 per cent. ABN AMRO and Mirae asset management also gained on their assets under management.
Reliance Capital AMC with a loss of Rs 7,617 crore in assets under management turned out to be the biggest loser in absolute terms. ING Investment management though was the biggest loser in percentage terms with a fall in AUM by 30 per cent. IDFC was next in line with a fall of 18 per cent.