June 18, 2015

Are Direct Investments Accelerating?

Consider this data taken from the AMFI website:

 

Total AAUM

Rs. crore

Direct AAUM

Rs. crore

Share of Direct to Total

Mar 2014

8,96,352

3,13,899

35%

Dec 2014

11,28,237

4,06,339

36%

May 2015

12,26,352

4,58,016

37%

While these are average AUM numbers for the respective months, it would still be reasonable to infer that from April 2014 through December 2014, the overall AUM of the industry increased roughly by 2,31,885 crore while the AUM through direct plans increased roughly by 92,440 crore.  In other words, the increase in AUM through direct plans was around 40% of the increase in the overall AUM.

But how much of this increase was on account of fresh sales?  I may be wrong but AMFI doesn’t appear to publicly divulge that number.  However, SEBI has given us this breakup in its just-released Handbook of Statistics on Indian Securities Market 2014.  As per Table 44, the amount of “Net Inflows” during the period from April 2014 through December 2014 was 87,942 crore.  Of this, 42,546 crore i.e. 48%, was through direct plans.

If you consider the period from January 2015 through May 2015, the overall AUM of the industry increased roughly by 98,115 crore while the AUM through direct plans increased roughly by 51,678 crore.  In other words, the increase in AUM through direct plans was around 53% of the increase in the overall AUM.  I’m not sure when SEBI (or AMFI, maybe?) will release the data for net sales for this period but for now, I’ll just leave you with something to think over: is the share of direct investments rapidly increasing?

The Handbook of Statistics on Indian Securities Market 2014 can be accessed here

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