Theres nothing special about mutual funds
By Our Banking Bureau | 09 Nov 2001
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Mumbai: The mutual fund industry is certainly going through a tough period for reasons known to all. And figures establish the same.
The July-to-September (2001) quarter has proved to be a flat one for mutual funds if one takes into account net collections. Association of Mutual Funds in India (Amfi) figures suggest that while the sale of units of various mutual funds resulted in an inflow of Rs 36,203 crore, redemptions led to an outflow of Rs 35,877 crore, leaving the net collection figure at a mere Rs 326 crore.
This is despite the fact that 19 new schemes were launched during the period under consideration, sales from which totalled Rs 586 crore. Equity-linked saving schemes, which basically provide tax-saving avenues, too, experienced a net outflow of Rs 40 crore.
Due to the depreciation of equity values, assets under management too declined 5.80 per cent at Rs 91,811 crore. Income funds, balanced funds and growth funds showed net outflows. Thus, while there was a net outflow of Rs 1,581 crore in income funds during the quarter under consideration, balanced funds depicted a net outflow of Rs 383 crore and growth funds that of Rs 41 crore.
Schemes such as money market funds and gilt funds, basically related to short-term money market operations, did better. In such schemes, returns can be ascertained in the very short term. While money market funds led from the front, recording a net inflow of Rs 2,234 crore, gilt funds received net inflows of Rs 137 crore.
Private sector mutual funds did better by recording net inflows of Rs 1,219 crore. While Indian-owned joint venture funds received a net inflow of Rs 828 crore, foreign-owned joint venture funds too received a net inflow of Rs 691 crore. On the other hand, private sector Indian funds recorded a net outflow of Rs 300 crore.
Finally, the largest mutual fund of the country, the Unit Trust of India, continues to perform poorly. In the period under consideration, it recorded a net outflow of Rs 1,262 crore, taking the net outflows during the year to Rs 3,927 crore.
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