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MOSL: FUND FOLIO (April 2017)-Indian Mutual Fund Tracker— AUM increases for fifth straight year to scale new highs

​FUND FOLIO (April 2017): Indian Mutual Fund Tracker— AUM increases for fifth straight year to scale new highs; cyclicals preferred in FY17

MF’s average AUM increased for the fifth straight year

• Domestic mutual fund (MF) industry average AUM increased (by 35% YoY or INR4.8t in FY17) for the fifth straight year to touch an all-time high of INR18.3t.
  
• The rise can be primarily attributed to inflows in income, equities, liquid and balanced categories, as domestic investors preferred SIPs and income/liquid schemes over traditional bank deposits.
  
• Equity AUM rose for the fourth consecutive year in FY17 to touch a new high of INR4.8t (+40% YoY), led by a rise in market indices (Nifty +18.5% YoY) and higher equity schemes sales (INR2,049b, +32% YoY). However, there was a meaningful rise in redemptions (INR1,447b, +65% YoY), leading to an 11% fall in net inflows to INR603b in FY17 from INR676b in FY16.
  
• Equity ELSS AUM of the industry rose 47% in FY17 and 21% over last five years.
  
• Equity AUM, as a percentage of India’s market capitalization, increased 40bp YoY to 4% in FY17.