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Debt assets of mutual fund houses rise 34% in FY13

Mutual fund houses saw an addition of nearly 34% to their debt asset base in FY13 as assets of income and actively managed bond funds rose amid a benign interest rate environment.

Mutual fund houses saw an addition of nearly 34% to their debt asset base in FY13 as assets of income and actively managed bond funds rose amid a benign interest rate environment.

The 43 fund houses collectively witnessed an addition of nearly R1.23 lakh crore in their debt asset base in FY13, data collated from Icra Online shows. As of March 2013, debt assets contributed nearly 74% to the overall mutual fund asset base, which is the highest in the last seven financial years.

Most of the bigger fund houses saw a sizeable addition in their debt assets. Reliance MF saw the highest addition of R15,119 crore in its debt assets, followed by ICICI Prudential (R13,540 crore), Birla Sun Life MF (R12,663 crore) and SBI MF (R11,015 crore). Reliance MF had also seen the highest decline in their equity assets (R3,212 crore) during the same period.

Other fund houses that saw a significant rise in their debt AUM include UTI MF (R8,692 crore), IDFC MF (R8,175 crore), HDFC MF (R8,015 crore), Kotak Mahindra MF (R7,940 crore), JPMorgan MF (R6,735 crore) and Franklin Templeton MF (R5,922 crore). Axis MF saw the highest decline in its debt asset base to the tune of R1,373 crore. Tata MF (R824 crore), Sahara MF (R674 crore), Canara Robeco MF (R423 crore) and Daiwa MF (R341 crore) also saw high declines in their debt AUM.

With assets of R59,211 crore at the end of FY13, ICICI Prudential MF has replaced HDFC MF to emerge the top fund house in terms of debt assets managed. Birla Sun Life MF (R54,575 crore) has moved up one spot to take the second place, while HDFC MF (R54,530 crore) has slipped two places to occupy the third spot. Kotak Mahindra MF, with debt assets of R24,483 crore, has overtaken Franklin Templeton MF to take the eight spot.

?Income, dynamic and actively managed bond funds saw good inflows throughout the year,? said Dhruva Chatterji, senior research analyst, Morninstar India. For instance, total assets of Morningstar Intermediate Bond category, which consist of medium to long term debt/income funds, grew by around 580% in FY13, data from Morningstar India, shows. Debt funds gave returns of anywhere between 8.9% and 11.06% in FY13 owing to a decline in long-term interest rates. Income and gilt medium-andlong-term funds emerged the top performers, giving returns in double digits. Long-term interest rates saw a significant decline in FY13, with yields on 10 year benchmark government bond yields falling to 7.95% from about 8.57% in the period.

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First published on: 24-04-2013 at 03:49 IST
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