Mumbai, May 30: Largest mutual fund, UTI, has started to draw investors back less than two years after a spate of trading scandals pushed the state-run money manager to the brink of collapse. A turnaround by Unit Trust of India (UTI), which boasts some 10 million investors, could boost confidence in the mutual fund industry in a country where the vast majority of people favour gold or fixed-rate bank deposits.
Total funds managed by the industry stood around 892 billion rupees ($18.9 billion) at the end of April, equivalent to four percent of India's GDP, according to the Association of Mutual Funds of India (AMFI). UTI has 435 billion rupees in assets.
"We have attracted 28 billion rupees in the past four months," K. Madhava Kumar, UTI's president, business development and marketing, told Reuters on Friday.
About two years ago, UTI was forced to impose severe curbs on withdrawals after a stock market scandal and a cash crunch triggered a run on the trust's funds.
Bureau Report