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MOSL: FUND FOLIO (June 2017)-Indian Mutual Fund Tracker — Equity AUM up for the sixth successive month-Net inflows in May at INR102b

​FUND FOLIO (June 2017): Indian Mutual Fund Tracker — Equity AUM up for the sixth successive month; Net inflows in May at INR102b – highest since June 2015

Equity AUM up for the sixth successive month

• Domestic mutual funds (MF) continued their positive momentum, with equity AUM touching a new high of INR5.2t (+2.7% MoM, +40% YoY) in May.
  
• The increase in equity AUM was led by a rise in market indices (Nifty up 3.4% MoM) and higher equity schemes sales (INR229b, +19% MoM). Redemptions rose 22% MoM to INR127b, leading to a rise in net inflows (INR102b, +15% MoM).
  
• Total AUM of the MF industry declined 1.2% MoM to INR19t in May due to a fall in AUM of Liquid funds (INR595b) and Gold ETFs (INR1b). All other categories saw a rise, particularly Equity funds (+INR134b), Income funds (+INR119b) and Balanced funds (+INR86b).
  
• Equity schemes witnessed inflows of INR102b in May – the highest since June 2015.
  
• Equity AUM, as a percentage of total AUM, rose 100bp MoM to 27.2% in May. Equity AUM accounts for 4.1% of India’s market capitalization.
  

Some interesting facts

• The month saw a notable change in sector and stock allocation of funds. On an MoM basis, the weights of Private Banks, Metals, Consumer, Technology, Auto and Infra increased, while those of Healthcare, Oil & Gas, PSU Banks, Cement, Cap Goods and Utilities showed signs of moderation.
  
• After increasing for seven consecutive months, the weight of Oil & Gas declined in May to 6.4% (-50bp MoM). Private Banks maintained its positive momentum for the second consecutive month to attain a high of 17.3% (+90bp MoM). Metals too maintained its upward trajectory, with a sustained MoM increase in its weight since May 2016.
  
• Healthcare sector weight reached a new low of 6.1% (-50bp MoM). As a result, the sector has fallen to the ninth position in sector allocation of mutual funds – it was at the fifth position 12 months ago.