The Hindu Business Line : Outflows apparent in large MFs

Here is full-blown evidence that a section of investors was busy taking out money from equity funds in the last one month, paying scant attention to the stock market that was recovering and actually leading towards a rise that was clearly evident during this period.

The indices may have moved up between May 31 and June 30, but that did not discourage these investors from exiting, as the latest numbers released by the Association of Mutual Funds in India (AMFI) suggest. The shift, in fact, has been quite apparent in the case of the largest and the most-well known schemes.

Equity Schemes

Among these are Fidelity Equity, Franklin India Flexi Cap, Franklin India Prima, HDFC Equity, Reliance Equity and Reliance Growth — each with over Rs 2,000 crore under management. Narrowing it down to just their growth options, the loss of assets has ranged from about Rs 50 crore to Rs 150 crore or so.

Consider specifically Reliance Growth, which had Rs 739 crore in its growth option at the end of May, a figure that has been pared to Rs 588 crore a month later. Or Reliance Equity, which has lost about Rs 70 crore.

Fidelity Equity, which is now in its second year, has dropped from Rs 918 crore to Rs 808 crore, while veteran HDFC MF, which was launched in late 1994, fell from Rs 1,013 crore to Rs 971 crore.

Markets Recover

In comparison, Franklin India Flexi Cap has come off from Rs 890 crore to Rs 837 crore, while Franklin India Prima has fallen from Rs 672 crore to Rs 543 crore. Again, only the growth options are being considered here.

It may be mentioned here that the equity market, which had started falling in the second week of May, witnessed a recovery of sorts during June. For the record, the 30-share Sensex stood at 10,398 points on May 31 and at 10,609 points on June 30.

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