Latest news with #NiravKarkera
Mint
26-05-2025
- Business
- Mint
Mutual fund holding in NSE-listed firms surpasses direct retail for the first time
Domestic mutual funds' holding in NSE-listed companies has surpassed ownership of individual investors for the first time to an all-time high, as flows into systematic investment plans remain steady amid selling in mid- and small-caps by the direct retail category. Mutual funds' share as a percentage of the total market capitalization of the companies listed on the National Stock Exchange (NSE) stood at a record high 10.4% in the quarter ended March 2025, surpassing the 9.5% share of individual investors who trade directly, according to NSE's India Ownership Tracker report. Record inflows These funds infused ₹1.9 trillion into equities in Q4 of FY25, taking total net inflows to ₹6.1 trillion for the year, the highest for any fiscal to date. Read more: Why balanced advantage funds are back in focus for moderate risk investors 'In value terms, DMF (domestic mutual fund) holdings stood at ₹42.4 trillion, down just 2.4% QoQ, despite a larger drop in the overall market cap, reflecting sustained net equity purchases," the report said, adding that the strong momentum was 'driven in part" by continued retail participation through systematic investment plans (SIPs). Individual holding in NSE-listed companies declined by 30 basis points sequentially to a seven-quarter low of 9.5% in January-March, led by reduced share in mid- and small-cap companies--a segment that saw aggressive buying by individuals over the past few years, according to the report. 'In value terms, individual holding in NSE-listed companies fell by 9.2% QoQ to ₹38.9 trillion—exceeding the overall drop in market cap—indicating subdued retail activity and elevated market volatility and uncertainty," the tracker showed. Market veterans expect the trend to continue, given that individuals trading directly tend to use the mutual fund route after encountering losses in their investments. 'We have seen market volatility between October last year and 7 April, which has singed direct retail," said B Gopkumar, managing director and chief executive officer at Axis Mutual Fund. 'This trend in holding will weigh in favour of mutual funds as some individual investors who have been hit by losses in any cycle tend to return through the MF route." Mutual fund inflows are expected to remain buoyant, said analysts. Read more: Why do your returns rarely match what funds deliver? "With the investment environment turning more favourable, mutual fund flows are likely to gain further strength," said Nirav Karkera, head of research at wealth-tech platform Fisdom. 'Positive equity outlook and a gradually emerging risk-on sentiment are expected to drive continued interest from retail investors." The total market cap of the listed universe fell to ₹408.9 trillion as of March from ₹436.6 trillion as of December.
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Business Standard
21-04-2025
- Business
- Business Standard
Mutual funds warm up to Reits and InvITs, but exposure remains low
Even as mutual funds (MFs) increasingly invest in real estate investment trusts (Reits) and infrastructure investment trusts (InvITs), their total exposure has remained below 0.4 per cent of the industry's assets under management (AUM). Although MFs have been permitted to allocate up to 10 per cent of their AUM to these assets since early 2017, significant investment growth has been seen only recently. From ₹734 crore in March 2020, investments have risen to nearly ₹20,000 crore in March 2025, according to Prime Database. Still, this accounts for just 0.3 per cent of the MF industry's ₹65.7 trillion AUM. Experts note that despite a growing number of schemes authorised to invest in Reits and InvITs, investments remain limited due to a strong equity market, liquidity issues, and constrained evaluation capabilities. 'The key reason for the slow uptick in demand is that the universe is not as broad and liquidity is limited. Also, given the equity market performance, fund managers have had little reason to look beyond stocks. Moreover, only a few AMCs have the evaluation and analytical capabilities to invest large sums in Reits and InvITs,' said Nirav Karkera, head, research, Fisdom. Only 22 of the nearly 45 fund houses have exposure to Reits and InvITs. The top three fund houses — SBI, ICICI Prudential and HDFC — account for 77 per cent of the total MF exposure. ICICI Prudential has the highest investments at close to Rs 5,200 crore. As of March 28, the index had delivered a total return of 8.5 per cent in a one-year period. In five years, the index has delivered annualised returns of nearly 16 per cent. In a recent consultation paper, the Securities and Exchange Board of India (Sebi) has proposed to enhance the scheme's investment limit from 10 per cent to 20 per cent for equity and hybrid schemes. The regulator also plans to raise the single issuer exposure limit from 5 per cent to 10 per cent. Experts say that while higher limits will help develop the Reit and InvIT markets, it may not lead to secular growth and the results will take time to show.
