UTI AMC Q2 net profit declines 12% to Rs 119 cr

UTI Asset Management Company’s consolidated net profit for the quarter ended September 30, 2020, stood at Rs 119 crore, down by 12% compared to the corresponding quarter last year.

The company saw a fall in other income and rise in the employee benefit expenses. Total assets under management (AUM) for the company stood at Rs 10.43 lakh crore, while quarterly average assets under management for UTI MF as on September 2020 stood at Rs 1.55 lakh crore. Other income from the AMC stood at Rs 10.95 crore in second quarter of this fiscal, down by 19.25%, while employee benefit expense was at Rs 91.06 crore in Q2FY21 up by 30.82%.

Imtaiyazur Rahman, chief executive officer at UTI AMC, said, “Post the Covid-related events in July and August 2020, UTI AMC saw improvement in investor flows and growth in AUM and witnessed a growth rate of 16.10% as against the industry growth rate of 12.07%, during the last quarter. The HY FY21 saw a rise of 3% in profits, driven by better investor stickiness, strength in the retail segment, and cost efficiencies.”

For the quarter ended September 30, 2020, equity assets (Active + Passive) contributed 45.1% to UTI MF’s total average AUM. For the quarter ended September 30, 2020, the ratio of equity oriented QAAUM and non-equity oriented QAAUM is 1.4:1 compared to the industry ratio of 0.94:1.

The gross inflows mobilised through systematic investment plan (SIP) for the quarter ended September 30, 2020 stood as Rs 759.65 crore. While the SIP AUM for the fund house as of September 30, 2020 stood at Rs 11,187.36 crore, an increase of 12.04% as compared to June 30, 2020.

The inflows into the SIPs for the mutual fund industry had remained flat in September compared to August. The inflows through SIP stood at Rs 7,788.37 crore in September compared to Rs 7,791.63 crore in August. Due to the volatility in the markets and uncertain future due to the ongoing pandemic, flows into SIPs have been below Rs 8,000 crore since June this year.

For all the months of last fiscal inflows through SIPs were above Rs 8,100 crore.

For the quarter ended September 30, 2020, digital purchase transactions for the fund house rose to 9.5 lakh transactions, which is an increase of 15.2% against the quarter ended June 30, 2020. The digital channel contributed 19.2% to total new purchase transactions. As on September 30, 2020, UTI AMC has geographical presence at approximately 697 districts in India, which is amongst the highest in the industry.