Mutual Fund Managers Swamp Debt Market With 6 Trillion Rupees

03/04/2015 2:59 PM IST | Updated 15/07/2016 8:25 AM IST
This photo taken on Saturday, Jan. 17, 2015 shows women making a transaction at an ATM as a man begs on Ermou Street, Athens' main shopping strip. Greece goes to the polls Sunday, Jan. 25, 2015 with voters given a tough choice over how to handle the country’s staggering national debt after six years of recession badly weakened its economy. The popular left-wing Syriza party is poised to defeat conservative Prime Minister Antonis Samaras, after campaigning on demands that other eurozone countries forgive at least half the bailout loan money received since 2010. (AP Photo/Yorgos Karahalis)

MUMBAI — Mutual fund managers pumped in nearly Rs 6 trillion in debt market in 2014-15, an increase of 8% from the preceding year, primarily on account of improved business sentiments.

Besides, fund managers invested a net amount of Rs 40,000 crore in equity markets during last financial year.

Moreover, mutual fund houses are upbeat about overall inflows in equities and debt markets for the current financial year (2015-16) as well.

Industry experts have attributed the inflows in debt markets during 2014-15 to the new government's reforms agenda, improved fundamentals of the domestic economy and increased participation from retail investors.

However, industry body Association of Mutual Funds of India's (Amfi) decision to put 1% cap on upfront commission paid to distributors may impact the sector, they added. As per data released by the capital markets regulator, Securities and Exchange Board of India (Sebi), mutual fund managers invested a net sum of Rs 5.87 trillion in 2014-15, higher than Rs 5.43 trillion pumped in the preceding year.

This inflow has helped the mutual fund industry to reach around Rs 12 lakh crore mark in assets under management (AUM) at the end of the financial year. In comparison, Foreign Institutional Investors (FIIs) made a net investment of Rs 1.64 lakh crore into debt markets during the period under review.

A mutual fund is an investment vehicle with a pool of funds collected from investors to buy securities such as stocks, bonds, money market instruments and similar assets.

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