MFs see outflow of Rs 84,000 cr in June '09


Combined net outflows into 35 fund houses of the country was at Rs 83,937 crore in June, against an inflow of Rs 30,148 crore at the end of May, as per data available on the Association of Mutual Funds in India (AMFI) website.

“Banks have pulled out a lot of money from the liquid schemes to meet their quarterly liquidity ratio. This led to outflow from the debt and money market funds in the month,” Taurus Mutual Fund Managing Director R K Gupta said.

After pulling out over Rs 54,54,650 crore in the fiscal year 2009, the MF industry saw net inflows to the tune of Rs 1,84,340 crore in the first two months of the current fiscal, which analysts feel was mainly due to the revival in the country’s equity market.

“The redemption pressure will come to haunt the market again at the end of September quarter, because banks account for the maximum money taken out from MF schemes,” Gupta noted.

At the end of June, investors had pulled out a hefty Rs 51,021 crore from income or debt funds, while equity funds saw inflows to the tune of Rs 1,493 crore.

During June, liquid or money market funds, which invest in safer and short-term instruments like treasury bills, certificates of deposit and commercial paper, saw outflows worth Rs 34,378 crore.  Also, Gilt funds witnessed outflows valued at Rs 20 crore, while balanced funds saw net inflows of Rs 41 crore during the month.

So far in July, there have been investments in debt instruments worth over Rs 25,000 crore, while in equity inflow is only Rs 450 crore, an analysis of daily buying and selling activity of MFs shows. “Investments in debt schemes would continue as banks are again flush with funds and are one of the largest investors in liquid funds,” Gupta said.  

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