Indian Mutual Fund AUM Rises First-Time in 4 Quarters : CRISIL

The Assets Under Management (AUM) of Indian Mutual Fund industry has recorded a growth of 4% for the first time in the past four quarters. A study conducted by CRISIL (Credit Rating and Information Services of India Ltd ) states that, debt-oriented funds are the key contributors to the rise in AUM.

According to the Association of Mutual Funds in India (AMFI), the rise in AUM by 4% to Rs.6.92 lakh crore in the April-June 2012 quarter from Rs.6.65 lakh crore in the previous quarter (excluding domestic fund of funds) is due to the rise in debt-oriented funds.

The study states that, assets of money market funds or liquid funds grew by Rs.16,900 crore, ultra short-term debt funds by Rs.6,900 crore, other debt-oriented funds by Rs.5,800 crore and Fixed Maturity Plans (FMPs) by Rs.2,900 crore over the past quarter. While equity funds have witnessed a decline of Rs.5,300 crore in AUM.

According to the CRISIL data, about two-thirds of the mutual fund industry has witnessed a rise in average AUM in the June quarter. CRISIL said that, this gain in assets in the first quarter for the money market funds could have been prompted by the slight ease in liquidity pressure in the current domestic financial system.

Liquidity in banking system has eased because of the proactive measures taken by the Reserve Bank of India (RBI), which had cut its key interest rate, the repo, by 50 bps to 8%, the first cut in around three years.