While the new year had started on a good note for the industry, the re-introduction of long term capital gains tax, or LTCG, and the subsequent frauds in banks took a toll on the markets; the Sensex fell 5% in February.
Here’s how different categories of funds fared in February.
Net inflows in equity funds remained strong
Despite the headwinds, the latest Association of Mutual Funds in India, or, AMFI, data shows that net inflows in equity funds (including balanced, ELSS, and ETFs) remained robust at Rs 22,247 crore. Of this, around Rs 6,000 crore comes from systematic investment plans.
However, the total equity assets of the industry fell from Rs 10.35 lakh crore in January 2018 to Rs 10.21 lakh crore in February due to mark-to-market losses.
Debt funds lost sheen
Income funds saw net outflows of Rs 9,799 crore, primarily due to redemptions from ultra short term funds. Also, long term bond and dynamic bond funds saw outflows on account of volatile interest rate scenario. Gilt funds too recorded net outflows to the tune of Rs 1,621 crore.
Net inflows in liquid funds were lower at Rs 1,223 crore in February 2018 as compared to Rs 96,552 crore in January 2018.
Collections from new fund offers were lackluster
New funds launched in February collected Rs 13,310 crore. Of this, a lion’s share of inflows came in income funds at Rs 11,080 crore. There were 28 closed end income fund launches and majority of them were fixed maturity plans of over three-year tenure.
Closed-end funds seem to have made a comeback but the collections are nothing to write home about. The industry launched five equity closed end funds which collectively mopped up Rs 1,995 crore in February 2018.
Industry’s total assets fell marginally in February
Overall, the industry received net inflows of Rs 12,092 core, largely on account of inflows in equity funds. While the inflows in equity funds were positive, the mark-to-market losses dragged down industry’s assets under management marginally from Rs 22.41 lakh crore in January to Rs 22.20 lakh crore in February 2018.
Net inflow/outflow in February 2018
