Assets Under Management AUM

“The PGIM India mutual fund will double the assets under management to Rs 14,000cr by March”

PGIM India Mutual Fund is on track to double the assets under its management to over Rs 14,000 crore by the end of this fiscal year, a senior company official said. The fund company, a wholly owned subsidiary of the US-based US group Prudential Global Investment Managers, launched its first small-cap fund on Friday with a targeted body of Rs 500 crore.

The fund house had closed fiscal year 21 with assets under management of approximately Rs 7,000 crore. He added Rs 2,000 crore to the prize pool during the first quarter of the fiscal year, a sequential growth of 28%.

“We had closed fiscal year 21 with an AUM of just over Rs 7,000 crore and we are on the verge of doubling it to Rs 14,000 crore, having already increased by more than 28% or Rs 2,000 crore per compared to figures for March, at Rs 9,000 crore from the end of June “, Ajit

, said the Managing Director of PGIM India MF.

The growth rate is commendable because despite the record market upturn, inflows into equity mutual funds had been declining steadily over the last few months of the year. PGIM India has the maximum exposure to equity programs with Rs 6,500 crore of its total assets under management in equity funds only.

But equity funds had the best inflows in May, growing Rs 10,083 crore, the highest in 14 months, according to Amfi data.

The equity programs saw a net inflow of Rs 3,437 crore in April and Rs 9,115 crore in March. Previously, equity plans had steadily experienced exits for eight consecutive months, from July 2020 to February 2021.

In contrast, exchange-traded funds (ETFs) attract a lot of investor attention, with NSE being the 100th of these instruments. ETF assets under management amounted to Rs 3.16 lakh crore at the end of May 2021, which is more than 13.8 times greater growth in five years compared to Rs 23,000 crore at the end of April 2016 among 60 ETFs.

On the dichotomy of a rising market and falling inflows to equity funds, Menon, who believes the market will continue to recover if there is no third wave, explains that the outflows are in part due to the fact that millions of investors entered the market in the pandemic and many of them took money out of mutual funds and put it directly into stocks.

His optimism for continued market momentum also stems from a likely jump in corporate earnings and positive trends on the pandemic side with a drop in infections and an increase in vaccinations, as markets move by discounting the future accordingly. emerging trends.

Of AUM’s total of Rs 6,500 crore from equity funds, Rs 1,400 crore from its international funds, Menon said.

He said to drive targeted growth, the fund company will launch more funds in larger mid-caps, flexible plans, small caps and retirement funds, where it is currently absent, later this year.

Another area of ​​growth is SIPs which he says are doing extremely well for them. Over the past year, they have added an average of 5 crore rupees to the book each month and have added 25,000 to 27,000 new folios each month, he said.

Regarding the new small cap fund, Menon said he plans to raise Rs 500 crore and if the fund gets a Rs 500 crore subscription at the NFO level itself which opens on Friday and ends on July 23, they will close the fund at the NFO level only. .

The PGIM India small cap fund is a mix of top-down and bottom-up investment approaches based on the Nifty small cap 100 and aims to generate long-term capital formation mainly through various investments made in share and share programs for small companies. capitalization companies.

The new fund will invest at least 65% of its corpus in small-cap companies and seek to leverage momentum from other equity and equity-linked products to make the portfolio attractive, Menon said.

The 45-player funds industry recorded net inflows of Rs 15,320 crore across all segments in June, compared to an outflow of Rs 38,602 crore in May, bringing assets under management to a record high of Rs 33.67 lakh crore at the end of June from Rs. 33 lakh crore in May.

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