The contribution of small towns or B30 cities to mutual fund industry’s average assets under management of over Rs 28 trillion stood at 16 per cent as of October-end, while state-wise Maharashtra remained the biggest contributor to the assets base, industry body Amfi said.
Since last few years, markets regulator Sebi has been pushing asset management companies to reach out to small towns for increasing their assets base.
B30 (beyond top 30 cities) accounted for 16 per cent of the total industry Average Assets Under Management (AAUM) in October this year, and the balance was contributed by T30 cities, or the top 30 locations in India, the Association of Mutual Fund Industry (Amfi) said.
Â
Assets from B30 locations increased to Rs 4.61 trillion as of October-end from Rs 4.47 trillion at September-end, a 3 per cent growth.
“There has been a constant increase in investments from B30 locations. They have close to 27 per cent share in the overall equity assets held by individual and it is growing at a reasonable rate,” said Harshad Chetanwala of MyWealthGrowth.com.
“This is encouraging as investors across country should get the benefit of investing in instrument like mutual funds. Even the interest levels from these cities have been high to understand how mutual funds can help them in long term,” he added.
B-30 locations tend towards equity schemes as 65 per cent of assets are from equity schemes, while same is 35 per cent for ‘Top 30’ cities.
About 15 per cent of the retail investors chose to invest directly, while 24 per cent of HNI assets were invested directly.
“Besides, 47 per cent of the assets of the mutual fund industry came directly. A large proportion of direct investments was in non-equity oriented schemes where institutional investors dominate,” Amfi noted.
Â
The mutual fund industry’s total AAUM shot up to Rs 28.34 trillion at the end of October from Rs 27.74 trillion at the end of preceding month.
In terms of state-wise contribution, Maharashtra continued to be the biggest contributor (43.8 per cent) of the industry’s AAUM in October this year, followed by 8.4 per cent by New Delhi, 6.9 per cent each by Gujarat and Karnataka and 5.2 per cent by West Bengal.
Individual investors primarily hold equity-oriented schemes while institutions hold liquid and debt-oriented schemes.
About 68 per cent of individual investor assets are held in equity oriented schemes, on the other hand, 75 per cent of institutions assets are held in liquid,money market and other debt-oriented schemes.
In September, Sebi chairman Ajay Tyagi had said that attraction of mutual fund schemes has been skewed towards the urban centres.
Â
“We need to strive more to make mutual funds popular in areas beyond top 30 cities,” he had said.
Dear Reader,
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.
Digital Editor
