Could you talk to us about the equity outflows that continued in February though the velocity was lower?
Equity numbers were in aggregate about Rs 10,000 crore negative. If you add all categories, hybrid funds and solution funds and international funds, you are probably looking at a net outflow of Rs 7,000-8,000 crore. It is a negative flow. As you said, the velocity of the number has come down substantially. There was a point when this number was closer to Rs 15,000-20,000 crore and so the outflow has come down. In fact, in the first few days of March, the data is positive for domestic equities.
Post the Budget and some sort of good news coming in from earnings, there is more client interest as far as domestic equities is concerned. We are seeing that in our flows as well. Categories like midcap funds and small cap funds are turning positive in terms of flows. Hybrid funds like balance advantage funds are rock solid. It bodes well that the trend is turning industry wise.
There is one interesting trend – flexi cap outflows have been over Rs 10,000 crore while inflows in multi caps are being seen for the second month in a row. This of course came after the SEBI notification on categorisation. Can you explain why we are seeing this sort of momentum in both of these categories?
Honestly, this one is a little curious because we do not have a large flexi cap fund. Rs 10,000 crore of flexi cap outflow is very big. And Rs 4,000 crore inflow in multicaps is also a very big amount. I suspect that there has been some serious switching from existing flexi cap funds into multi cap funds. It could be that a flexi cap fund was very large in size because they were erstwhile multi cap funds and people are moving the money into may be more mid-sized multi cap funds. That could be something that is happening. I suspect this is a switch from one category to another.
