Equity MFs net tidal inflows in the first half of current fiscal

Equity mutual funds posted net investment inflows worth Rs 89,274 crore in the first six months of this fiscal, leaving behind last (full) year's net pooling of Rs 73000 crore by a significant margin.

Higher SIP (systematic investment plans) allocations, wider HNI participation, chunky investment ticket sizes and some NFO (new fund offer) contributions spiked up equity MF inflows this fiscal, industry sources said.

"SIP numbers have gone up significantly over the past one year," said a fund-watcher at CAMS, a leading registrar and transfer agent. "Number of SIP account holders has gone up from 55 lakhs last year to about 90 lakhs currently. Average investment ticket size has also gone up from Rs 2500 levels to over Rs 3000 ever month," the CAMS analyst said.

Investors remained bullish on equity mutual funds, despite market volatility. The category saw assets rise for eight consecutive quarters. According to a recent Crisil report, the category's average AUM rose 9% or Rs 360.47 billion to a record-high of Rs 4.36 trillion, led by robust inflows of Rs 274.56 billion. However, marked-to-market (MTM) losses restricted rise in AUM; the underlying asset class, represented by the CNX Nifty, lost 5.0% during July - September quarter, the Crisil report said.

"The inflows have been pretty good over the last few months. While a good part of it is driven by genuine interest, there have been some push-sales as well," said Vijai Mantri, advisory committee member of Nirmal Bang Securities and former CEO of Pramerica Mutual Fund. "My only worry is a possible outflow of hot money in the event of a deep market correction," Mantri added.

Domestic mutual fund industry reported gains for the eighth consecutive quarter, up 7.1% or Rs 872.39 billion, to end with average assets of Rs 13.16 trillion (excluding fund-of -funds). A surge in equity and debt-oriented funds, except fixed maturity plans (FMPs), drove up average asset base.