It is likely India's equity mutual fund sector recorded a good performance in April, thanks to a decline in redemption requests and better inflows.
In April, equity fund managers didn't seem under heavy pressure to liquidate holdings to meet redemptions, as was seen till February. According to Securities and Exchange Board of India data, overall net selling by equity fund managers stood at Rs 1,423 crore, against Rs 1,613.6 crore in March. Executives said this meant in April, when benchmark stock indices rose 3.5 per cent, inflows in equity schemes improved and redemptions were less.
According to sector officials, the decline in redemption requests had provided relief. Though there wasn't a substantial difference in inflows, assets under the equity segment remained relatively sticky.
Karan Datta, national sales head at Axis Mutual Fund, said, "All our equity schemes saw net positive inflows in April, and this is encouraging." In March, the sector had reported net positive inflows in equities, after several months, at about Rs 500 crore. According to Deepak Chatterjee, managing director and chief executive of SBI Mutual Fund, better performance in the equity segment in April, compared to March, could be a sign that investors were looking at equity schemes again.
"The last month saw a general improvement in the overall economics of the country; we are seeing renewed interest among investors in equities," said Akshay Gupta, chief executive officer, Peerless Mutual Fund.
In 2012-13, the sector saw record high outflows from equities - about Rs 14,600 crore, against positive inflows in the previous financial year. After such massive outflows and dwindling sales, even a slight improvement in equity sales brings cheer to the segment.
The Association of Mutual Funds in India will release the latest monthly data later this week.
Currently, fund houses offer 347 equity-related schemes, including equity-linked savings schemes. As on March 31, assets under management in the equities segment stood at Rs 1.72 lakh crore, a quarter of the sector's overall assets under management.
- Inflows in equity schemes improved and redemptions were less during April
- However, assets under the equity segment remained sticky