Monthly Performance Round up for December 2006. The BSE Sensex lost around 0.42 percent in the month of December 2006. The broader Index BSE 100 lost 0.51 percent. The Nifty Fifty also looked in a bad mood and lost 0.78 percent. The Reserve Bank of India (RBI) announced a rise in Cash Reserve Ratio (CRR) by 50 bps and the corporates lined up in front of the Tax department to pay advance taxes by 15 December. All these contributed to the beating Mutual Fund houses took in the last month of the historical year 2006. Although everything seemed to be in red in the last month, BSE – IT and BSE Small Cap managed to gain more than 2.50 percent on an absolute basis during the last month. The mid caps and the small caps which were looking as laggards during the last year when compared to their large cap counterparts, gained well during the last month. It outperformed the BSE Sensex and the Nifty Fifty in the last month and looked good compared to the other indices. The Asset under Management (AUM) declined from Rs.341377.8 crores in November to Rs.323609.91 crores loosing a total of Rs.17767.86 crores. The decline of this 5.21 percent was mainly because the decline in the assets of the Liquid Funds which saw a decrease of around 20 percent over the last month. The major reason for this huge decline was the banks pulling out heavily from mutual funds following the new regulation of RBI which has asked the banks to maintain a CRR of 5.5 percent as against 5 percent earlier. The CRR has been raised by 25 bps in the first round and stands at 5.25 percent as of now; soon it would be raised by another 25 bps to reach the CRR of 5.5 percent. CRR is the percentage of the deposits which the banks need to maintain with the RBI. The other main reason for the 20 percent decline was because the corporates withdrew their investments as they had to pay their Advance Taxes. The corporates generally put in their cash in the liquid funds to earn a better return out of them when compared to the returns given by the banks or the government securities. This money is withdrawn as soon as there is a requirement of money by them. The returns in terms of rate of interest are very low but the amount generated is quite significant as the amount put in by the corporates is huge. Also the major benefits they get are that the liquidity is quite good when compared to the bank deposits and the government bonds. These two main reasons contributed to the fall the AUM in the mutual fund industry in the month of December. The month also saw Reliance Mutual Fund replacing Prudential ICICI Mutual Fund in the private sector in terms of AUM. The corpus of Reliance as on December, 2006 was Rs.36927.92 crores and the corpus of Prudential ICICI was Rs.3304.58 crores. UTI Mutual Fund still sits at the top position at its number one position among all the Mutual Fund houses in the country with a corpus size of Rs.38108.50 crores. Out of the 30 AMCs in the country, 23 saw a decline in their AUM in December. LIC Mutual fund witnessed the largest decline in terms of AUM falling by an amount of Rs.4881.57 crores. Reliance Mutual Fund saw the maximum increase in its corpus with Rs.2291.03
crores. Reliance Mutual Fund collected about Rs.2000 crores from its New Fund Offer of Reliance Long-Term Equity Fund. |
A brief synopsis of the top Mutual Funds have been provided below:-
Top Mutual Funds w.r.t. to fund corpus
Sr. No. |
Mutual Fund |
Date |
AUM (in Rs.Crores) |
1 |
UTI Mutual Fund |
31/12/2006 |
38108.5 |
2 |
Reliance Mutual Fund |
31/12/2006 |
36927.92 |
3 |
Prudential ICICI Mutual Fund |
31/12/2006 |
33304.58 |
4 |
HDFC Mutual Fund |
31/12/2006 |
29635.29 |
5 |
Franklin Templeton Investments |
29/12/2006 |
23403.15 |
Scheme Name |
1 Month Absolute Return % |
Rank as per 1 Month |
Prudential ICICI Service Industries Fund Growth |
7.8966 |
1 |
Kotak Contra Fund Growth |
5.6710 |
2 |
Prudential ICICI Dynamic Plan Growth |
5.6336 |
3 |
Reliance Vision Growth |
4.9963 |
4 |
Taurus Starshare |
4.9787 |
5 |
Scheme Name |
1 Month Absolute Return % |
Rank as per 1 Month |
Reliance Tax Saver Fund Growth |
4.9110 |
1 |
Kotak Taxsaver Growth |
4.4071 |
2 |
ING Vysya Tax Saving Fund Growth |
3.9276 |
3 |
Sundaram BNP Paribas Taxsaver (Open Ended Fund) Growth |
3.5250 |
4 |
Tata Tax Saving Fund |
3.1862 |
5 |
Scheme Name |
1 Month Absolute Return % |
Rank as per 1 Month |
Prudential ICICI Balanced Growth |
2.3950 |
1 |
HDFC Prudence Fund Growth |
1.6078 |
2 |
Kotak Balance Growth |
1.5189 |
3 |
DSP ML Balanced Fund Growth |
1.4446 |
4 |
ING Vysya Balanced Fund Growth |
1.1686 |
5 |
Scheme Name |
1 Month Absolute Return % |
Rank as per 1 Month |
Benchmark Derivative Fund Growth |
0.9063 |
1 |
Kotak Cash Plus Growth |
0.8284 |
2 |
JM Equity & Derivative Fund Growth |
0.7890 |
3 |
Prudential ICICI Blended Plan - Option B Growth |
0.6429 |
4 |
ABN AMRO Flexi Debt Fund Growth |
0.5866 |
5 |