In a first of its kind move in the Indian mutual fund space, all fund houses have begun disclosing investments of group companies in their AUMs (assets under management), with Birla Sun Life MF topping the list with Rs 6,585 crore from its related entities.
While Reliance MF became the first fund house to make such disclosures voluntarily earlier this year, it was followed by Religare MF. However, regulator Securities and Exchange Board of India (Sebi) has now made it mandatory for fund houses to make such disclosures.
SBI MF (Rs 5,218 crore) was positioned second in the list for investments by group companies in absolute terms, followed by ICICI Prudential MF (Rs 4,971 crore), HDFC MF (Rs 4,032 crore) and Reliance MF (Rs 3,650 crore).
In terms of highest AUM contribution from group distributors, SBI MF tops the list with Rs 10,136 crore, followed by HDFC MF (Rs 7,766 crore), Axis MF (Rs 6,116 crore), ICICI Prudential (Rs 5,802 crore) and Birla Sun Life (Rs 5,012 crore).
Reliance MF, which is India's third largest fund house after HDFC MF and ICICI Pru, has AUM contribution of only Rs 547 crore (0.5 per cent) from its group distributors.
These disclosures are for the month of March, during which the AUM of mutual fund industry normally shrinks by about 20 per cent in the last 15 days due to redemption by corporate and bank investors.
Such disclosures would be now made every month by all 44 fund houses operating in the country.
The fund houses have disclosed the exact amount of investments by their group companies in their respective schemes following a Sebi directive.
As per Sebi's direction, MFs are required to make monthly disclosure of AUM from different categories of schemes, AUM from places beyond top-15 cities, contribution of sponsor and its associates in AUM and contribution from different types of investors (retail, corporate etc.).
The fund houses also need to make disclosures about state-wise contribution and AUM from sponsor group or non-sponsor group distributors on their websites and share the same with AMFI within seven working days from end of the month. These rules came into effect from this month.
The norms were recently framed by the market regulator as part of its first-ever long term policy for the mutual fund industry.
There was no change in rankings within the top-20 fund houses even after excluding group AUM. However, after excluding Group average AUM, the gap between ICICI MF and Reliance MF has come down from Rs 2,638 crore to Rs 1,317 crore, while the gap between Reliance and Birla Sunlife MFs has increased further.
Currently, HDFC MF is the largest with overall average AUM of Rs 1.13 lakh crore, followed by ICICI Prudential MF (Rs 1.06 lakh crore), Reliance MF (Rs 1.03 lakh crore), Birla Sunlife (Rs 86,000 crore) and UTI MF (Rs 73,000 crore) in the top five.
After excluding group investments, HDFC MF still tops the charts with Rs 1.09 lakh crore, followed by ICICI Pru at Rs 1.01 lakh crore, Reliance MF at Rs 99,700 crore, Birla Sunlife at Rs 79,500 crore and UTI MF at Rs 70,500 crore.
For March, Baroda Pioneer MF recorded the highest exposure of group investments in percentage terms at 9.79 per cent, although the absolute figure was very low at Rs 752 crore. LIC MF has the lowest exposure of only 0.11 per cent or investment to the tune of Rs 12 crore by group companies.
According to data, average investment of group companies in 20 mutual fund houses stood at Rs 37,454 crore, accounting for 4.43 per cent of the fund houses' total AUM.
At least seven mutual fund players - Birla Sun Life MF, SBI MF, DSP Black Rock MF, Tata MF, L&T MF, Baroda Pioneer MF and HSBC MF - have witnessed more than five per cent exposure by group companies.
Among these, DSP Blackrock had 7.9 per cent group investments, followed by SBI MF (7.7 per cent) and Birla Sunlife (7.6 per cent). Among other large players, group investments stands at 4.7 per cent for ICICI Prudential MF, 3.55 per cent for HDFC MF and 3.53 per cent for Reliance MF.