Friday 13 March 2015

Mutual Funds Newsletter - March 09 to 13, 2015

The Indian mutual fund industry’s assets under management (AUM) rose 1.76% or by Rs 208.40 bn to Rs 12.02 trillion in February 2015, according to the monthly numbers released by the Association of Mutual Funds in India (AMFI).

News this week
 
MF assets cross the Rs 12 trillion mark
The Indian mutual fund industry’s assets under management (AUM) rose 1.76% or by Rs 208.40 bn to Rs 12.02 trillion in February 2015, according to the monthly numbers released by the Association of Mutual Funds in India (AMFI). This is the first time the industry’s assets have crossed the Rs 12 trillion mark. Gains were led by inflows into equity, balanced, gilt and liquid funds.
 
Positive sentiment for the underlying asset class helped equity funds attract net inflows (Rs 58.40 bn) for the tenth consecutive month in February. The category’s assets rose 1.41% to close at a record high of Rs 3.46 trillion. The underlying asset class, represented by the benchmark CNX Nifty Index, gained 1.06% in the month on positive cues from announcements in the Union Budget 2015-16, upbeat domestic GDP growth estimate and encouraging international developments..
 
Equity MFs report net inflow of about Rs 61,000 crore 
Mutual fund's equity assets rose from Rs. 1.57 trillion in February 2014 to Rs 3.07 trillion in February 2015, according to AMFI. Mutual funds invested Rs 5,200 crore in equity schemes in February, taking the total inflow to over Rs 61,000 crore in the first 11 months of the current financial year. AMFI said that equity funds saw net inflow of Rs. 5,217 crore in February as compared to Rs. 5,850 crore witnessed in the preceding month. Since April 1, 2014, equity schemes have registered net inflow of about Rs 61,000 crore. The latest inflow takes the total fund infusion in equity MF schemes to Rs. 61,089 crore at the end of February.
 
MFs buy equities worth Rs. 880 cr in Jan: SEBI
Mutual Funds made net investment of Rs. 34,004 crore in the secondary market in January 2015 compared to net investment of Rs. 60,969 crore in December 2014, according to SEBI Bulletin for the month of February 2015. Mutual funds invested Rs. 880 crore in equity in January 2015 compared to Rs. 7,037 crore in December 2014. Further, mutual funds invested Rs. 33,124 crore in debt market in January 2015 as against of Rs. 53,932 crore invested in December 2014, the SEBI added..
 
Investors' demat accounts rise marginally in Jan
The total number of investor accounts was 137 lakh at NSDL and 94.3 lakh at CDSL at the end of January 2015. In January 2015, the number of investor accounts at NSDL and CDSL increased by 0.5 percent and 0.4 percent, respectively, over the previous month. A comparison with January 2014 showed there was an increase in the number of investor accounts to the extent of 4.5 percent at NSDL and 7.9 percent at CDSL. S&P BSE Sensex closed at 29,183 on January 30, 2015, as against 27,499.4 on December 31, 2014, registering an increase of 1,683.5 points (6.1%).
 
Foreign investors buy shares worth Rs. 33,688 cr in Jan 
With the commencement of FPI Regime from June 1, 2014, the erstwhile FIIs, sub accounts and QFIs are merged into a new investor class termed as “Foreign Portfolio Investors (FPIs)”. There was a net inflow of Rs. 33,688 crore in January 2015 by FPIs compared to net inflow of Rs. 12,225 crore in December 2014. FPIs invested Rs. 12,919 crore in equity in January 2015 as compared to inflow of Rs. 1,036 crore in equity in December 2014. Further they invested Rs. 20,769 crore in debt market in January 2015 as compared to Rs. 11,188 crore invested in December 2014.
 
Much needs to be done to finalise REIT tax structures: CBRE
According to property consultant CBRE study, tax structures for the real estate investment trusts (REITs) need to be further rationalised to make it more attractive to investors, particularly foreign. "Despite the greater clarity provided by the Budget announcement, much still needs to be done to finalise REIT tax structures and make them attractive to investors, particularly foreign groups," CBRE Research said. REITs is typically a closed-end investment fund that trades on an exchange and uses the pooled capital of many investors to purchase and manage income properties.
 
MFs rush to launch 23 new schemes
Over 23 new fund offers (NFOs) will be launched later this month as fund houses rush to raise maximum money by paying high commissions to distributors to sell their products, says a media report. In order to curb mis-selling, the Association of Mutual Funds in India (AMFI) has urged funds to limit upfront commission to 1% starting April 1, the report added. At present, there is no limit on upfront commission and fund houses often pay upfront commissions of upto 8% to their distributors for selling a MF scheme, the report further said. 
 
Pvt mutual funds report net inflow of Rs. 91,162 cr in Jan: SEBI 
Mutual funds saw net inflow of Rs. 1.06 trillion in January 2015 as compared to a net outflow of Rs. 41,388 crore in December 2014, according to SEBI Bulletin for the month of February 2015. The private sector mutual funds reported inflows of Rs. 91,162 crore in January 2015, while public sector mutual funds saw inflow of Rs. 15,716 crore. Private sector mutual funds witnessed outflow of Rs. 38,936 crore, whereas public sector mutual funds saw outflow of Rs. 2,452 crore in January 2015.

Equity market garners funds worth Rs. 4,308 cr in Jan: SEBI
There were 26 preferential allotments worth Rs. 2,538 crore listed on BSE and NSE in January 2015 as compared to 21 preferential allotments worth Rs. 606 crore in December 2014, according to SEBI bulletin for the month of February 2015. The cumulative amount mobilised through preferential allotments route during 2014-15, as on January 30, 2015, stood at Rs. 25,679 crore through 374 issues, SEBI said. In the corporate debt market, Rs. 46,187 crore were raised through 188 issues by way of private placement listed at BSE and NSE during January 2015 compared to Rs. 47,898 crore raised through 296 issues in December 2014..
 
SBI MF launches Dynamic Asset Allocation Fund
SBI Mutual Fund announced the launch of SBI Dynamic Asset Allocation Fund (SDAAF), an open-ended dynamic asset allocation fund, which uses a model-driven asset allocation process to dynamically allocate between equity, debt and cash based on market and economic conditions so as to provide investors with long term capital appreciation.
SDAAF would have the flexibility to remain invested, up to 100 per cent in either debt or equity or a mix of the two as per the asset allocation model.

LIC Nomura MF launches Banking & Financial Services Fund 
LIC Nomura Mutual Fund, on Monday has launched LIC Nomura MF Banking & Financial Services Fund. It is an open ended Banking & Financial services sector scheme and the New Fund Offer (NFO) will open today, March 09, 2015 for subscription and will close on Monday, March 23, 2015.
 
Primary market mobilise funds worth Rs. 2,288 cr in Jan: SEBI 
During January 2015, Rs. 2,288 crore were mobilised in the primary market (equity and debt issues) by way of four issues as compared to Rs. 761 crore mobilised through four issues in December 2014, showing an increase of 200.4 percent from the previous month. In January 2015, Rs. 1,545 crore were mobilised through three equity issues as compared to Rs. 361 crore mobilised by the way of three equity issues in December 2014, according to SEBI bulletin for February 2015.
 
ICI reports estimated US long-term mutual fund flows for latest week 
Total estimated inflows to long-term mutual funds in US were $6.51 billion for the week ended Wednesday, March 4, the Investment Company Institute reported. Equity funds had estimated inflows of $977 million for the week, compared to estimated inflows of $2.43 billion in the previous week. Domestic equity funds had estimated outflows of $1.93 billion, and estimated inflows to world equity funds were $2.91 billion. Hybrid funds, which can invest in stocks and fixed-income securities, had estimated inflows of $528 million for the week, compared to estimated inflows of $1.05 billion in the previous week.
 
ICICI Pru MF launches India Recovery Fund - Series 1
ICICI Prudential Mutual Fund has announced the launch of ICICI Prudential India Recovery Fund– Series 1, a 3.5 year close ended equity fund that aims to provide long-term capital appreciation by taking exposure in stocks/sectors that are more levered to the economy and are likely to grow at a fast pace. The fund would be managed by Mr. Mrinal Singh and Mr. Rajat Chandak. Nimesh Shah, MD & CEO, ICICI Prudential Asset Management Company Ltd. said, “India is positioned towards the recovery trajectory with improvement in macro-economic indicators, uptick in business sentiment, government’s focus on new & existing projects and thrust on reforms. We believe the economy has reached the inflection point and is expected to move into a high growth phase over the next 3 to 5 years.”.
 
Baroda Pioneer AMC launches Hybrid Fund–Series I
Baroda Pioneer Mutual Fund on Monday announced the launch of Baroda Pioneer Hybrid Fund-Series I, a close ended hybrid scheme. This product is suitable for investors who are seeking to generate income and capital appreciation over the short term to medium term. The New Fund Offer (NFO) is open for subscription from 2nd March 2015 and closes on 17th March 2015. The units will be available at par - Rs.10/- The primary objective of the Scheme is to generate income by investing in fixed income securities maturing on or before the date of the maturity of the Scheme and to generate capital appreciation by investing in equity and equity related instruments.
 
Deutsche Asset Management launches Large Cap Fund-Series 1 
Deutsche Asset Management India announced the launch of DWS Large Cap Fund – Series 1, a 1281 days close ended equity fund. The New Fund Offer period is from March 4 to March 18, 2015. The objective of the scheme is to generate capital appreciation from a diversified portfolio of equity and equity related securities of large cap companies in India. CNX Nifty Index is the benchmark index.

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