Who moved my equity AUM in 2017

DSIJ Intelligence / 17 Jan 2018/ Categories: Markets, Mutual Fund, Trending

BSE Sensex reached a new milestone of 35,000 on Tuesday. It has been achieving new highs almost every month for the past one year. This has helped attract record flows into equity funds. Read on to find out how much of these funds have flown to equity schemes in 2017.

Equity asset under management (AUM) of Indian mutual fund industry including ELSS rose for the fourth successive year in 2017. It grew by net 64% in the year 2017 compared to 2016. It increased from Rs 4.697 lakh crore at the end of December 2016 to Rs 7.711 lakh crore at the end of December 2017. This increase was despite record outflow that was witnessed from the equity scheme. For the calendar year, 2017 total sales and redemption witnessed by equity schemes was to the tune of Rs 1.91 lakh crore.

Despite such outflow, what helped the equity AUM to rise is the record sale or subscription of equity schemes. For the year 2017, it saw an inflow of Rs 3.43 lakh crore. The rest of the increase was due to capital appreciation, which was to the tune of Rs 1.49 lakh crore. Therefore, in CY17, mutual funds’ gross inflows rose 84 per cent to Rs 3.41 lakh crore, while redemptions increased 45 per cent to Rs 1.91 lakh crore. Consequently, the net inflows were up 178% to Rs 1.5 lakh crore in CY17. Such an increase in equity MFs has helped equity AUM increased 70bp YoY to 5.1 per cent in CY17, as a percentage of India’s market capitalization, this again is an all-time high. In the last one year, it has witnessed a jump of little more than 1 per cent. This is despite, the total market cap of Indian equity rising by 37 per cent in last one year from Rs 1,12,56,330.30 crore at the start of 2017 to Rs 1,51,73,866.88 crore at the end of December 2017.

The year 2018 has seen one of the best starts in the equity market in the last several years, if this continues, we may once again see equity schemes making new records this year.