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MF equity folio rides rally, surges 25 lakh in FY15

Equity mutual funds are in an overdrive, which saw 25 lakh investor accounts or folios added in 2014-15, mainly on account of a sharp stock market rally and strong retail participation.

Folios are numbers designated for individual investor accounts though one investor can have multiple ones.

According to Securities and Exchange Board of India (Sebi) data on investor accounts with 44 fund houses, the number of equity folios jumped to 3.17 crore last month from 2.92 crore a year earlier.

April saw the first rise in more than four years.

Prior to 2014-15, the equity MF sector had seen a continuous closure of folios since March 2009 after the global financial crisis hit the market in late 2008. Since March 2009, as many as 1.5 crore folios have been wound up.

The investor base reached its peak of 4.11 crore in March 2009 while it was 3.77 crore in March 2008.

Before 2014-15, there was a complete lull in equity inflows as well as generation of new folios, but in the past one year, equity markets have come back to life and yielded solid returns.

Industry experts said a strong rally in the equity markets and the heightened investor interest led to a sharp increase in retail folios.

“It is the optimism of investors because of which the folios in equity segment have increased. Besides, increased participation by retail investors in equities has led to increase in folio numbers,” UTI MF Sales and Marketing President Suraj Kaeley said.

The addition in equity folios is in line with the BSE Sensex surging 25 per cent in 2013-14.

Moreover, mutual funds reported net inflows of over Rs 68,000 crore in equity funds in the last fiscal year, helping the industry grow its folio count.

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