Page 16 - Banking Finance March 2019
P. 16
MUTUAL FUND
MUTUAL FUND
Mutual funds invests Sebi seeks to make mutual funds' valuation process fair
over Rs 7,000 crore in Sebi's board recently approved changes in its norms for open offer exemptions
for corporates facing debt restructuring as also for
equities in January debt instrument valuation by mutual funds to
make these processes fairer.
The Sebi board, at the same time, approved eas-
ing of norms for raising of funds through instru-
ments like real estate and infrastructure invest-
ment trusts. The regulator will amend its norms for valuation of money market
and debt securities by mutual funds to make the process fairer and uniform
across the industry to safeguard investors from default like scenarios as witnessed
recently in the wake of IL&FS crisis and other defaults.
The proposal seeks to make the valuation practices more reflective of the real-
Mutual fund houses made invest-
ment of over Rs 7,000 crore in do- izable value of money market and debt securities with residual maturity up to
mestic equities in January, even as 60 days. Accordingly, the residual maturity limit for amortisation based valua-
foreign investors pulled out Rs 5,200 tion by mutual funds will be reduced from 60 days to 30 days. The threshold
crore. The sell-off by foreign portfo- maintained between reference price and valuation price would be plus or mi-
lio investors (FPIs) from the Indian nus 0.025 per cent, while the reference price will be taken as security level price
equity markets has provided an op- given by the valuation agencies.
portunity to mutual fund managers,
experts believe. According to the Mutual funds collect Rs 8,064 crore via SIP in January
data available with Sebi and deposi- 19
tories, fund managers bought shares Mutual funds garnered Rs 8,064 crore through SIP in
worth Rs 7,160 crore on a net basis January 2019, 21 per cent higher year-on-year, shows
last month.
data from AMFI. Mutual funds collected Rs 8,022
On the other hand, FPIs pulled out Rs crore through SIPs in November. "Despite acute mar-
5,264 crore from equities. Invest- ket volatility owing to credit events and global uncer-
ment in domestic equities by fund tainty, retail investors continue to repose their faith in the India growth story.
managers could be largely attributed
to retail investors who continue to This is quite evident from the SIP flows and folio numbers, which continue to
invest through systematic invest- rise sequentially," says N S Venkatesh, CEO, AMFI. Mutual funds have currently
ment plan (SIP), market experts said. about 2.57 crore (25.7 million) SIP accounts through which investors regularly
invest in the schemes.
16 | 2019 | MARCH | BANKING FINANCE
