In the financial markets which led to rapid expansion

In India, the asset
management industry is considered as the fastest growing in the world. As of
November 17, there are about 42 companies operating in this country under this
segment. In the year ending December 2017, the assets under management of the mutual
fund industry stood at Rs 21.27 lakh crore (US$ 328.49 billion). And around an
inflow of Rs 47,002 crore was registered in India’s mutual fund schemes via
systematic investment plan route between April-December 2017. During the
Financial year 2016-17, also a record inflow of amount of US$ 51.02 billion in
mutual funds was registered. According to the reports of Association of Mutual
Funds in India, this was regarded as the highest investment in mutual fund
schemes since the Fiscal year 1999-2000. In the area of equity mutual funds, a
net flow of Rs 14,921 crore was recorded thereby resulting an increase in the
asset base to Rs 6.90 lakh crore in December 2017. Also due to rising increase
in the mutual funds of investors it led to the increase in the number of
portfolios which was registered as 66.5 million as of December 2017. The Mutual
fund equity portfolios reached a 10 year high by the end of 2017.

 

Diagram
depicting the composition of investors and the top companies acquiring the
Asset management industry

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It is evident that the
corporate investors accounted for almost 46.25 per cent in total AUM in India
in September 2017, while the high net worth individuals (HNWIs) and retail
investors accounted for 28.01 per cent and 22.96 per cent respectively. It is
recorded that there is significant decrease in the percentage of acquisition by
the different investors during the year 2016-17, the percentages have been
slightly decreased over the period. Coming to the leading AMCs, ICICI
Prudential Asset Management Co. Ltd holds the first position with highest worth
of US$ 43.40 billion followed by the different AMCs as shown in the list.

 

Equity Market Turnover

Graph
showing the turnover on NSE and number of companies listed in major stock
exchange

With the steadily rising
turnover in the financial markets which led to rapid expansion in the brokerage
segment. It is evident that a growth at a CAGR of 19.13 per cent between the
year 1996-2017 which results in reaching a value of US$ 790.21 billion in the
FY 2017. Also the good performance of NSE has led to yielding the best returns
since 2014 and significant rise in the turnover is quite evident. Major factor
contributing towards the increase of equity market turnover is the increase in
the number of companies listed in the country’s stock exchange i.e. it rose
from 135 in 1995 to 1885 in November 2017. The regulation of Securities and
Board of India (SEBI) has contributed much towards protecting the right of the
shareholders due to its various reforms and legislation governing the sector.

 

Increase in the number of
listings

Graph
showing the number of listed companies and amount raised by IPOs

A significant increase in
the listed companies of NSE and BSE from 6,445 in FY 10 to 7,501 in December
2017 is recorded. Around Rs 150 lakh crore was the market capitalisation of all
the listed companies and it is projected that the revenues of brokerage
industry in India are estimated to grow by 15-20 per cent to reach US$
2.80-2.96 billion in the FY 2017-18 which results in healthy volumes and
increase in the share of the cash segment.

Coming to the IPOs, in
India it increased from US$ 318 million in FY 2008-09 to US$ 10,888 million in
FY 2017-18 and significant record was registered in IPOs by Small and medium
enterprises  with a finding of Rs 16.79
billion in 2017 through 133 issues. It is recorded that around a total of 153
IPOs were issued in Indian stock markets in 2017 which amounted around raising
a total of US$ 11.6 billion.

 

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