Mutual funds sitting on Rs 1.86 lakh crore cash in September

Mutual funds have deployed cash in the rising market, as cash as a percentage of total AUM went down from 5.20% in August to 5.02% in September. The total cash mutual funds had was Rs 1.86 lakh crore in September, which was at the same level as in August. The total equity AUM in September was recorded at Rs 37.13 lakh crore as of September 2024.

Around six mutual funds were sitting on more than Rs 10,000 crore cash in their portfolio in September 2024. Among the 43 mutual funds, ICICI Prudential Mutual Fund had the highest cash in its portfolio of Rs 31,976 crore as on September 2024. The largest mutual fund based on assets managed, SBI Mutual Fund, had Rs 27,126 crore cash in its portfolio which was 3.71% of the total AUM.

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HDFC Mutual Fund and PPFAS Mutual Fund had Rs 23,701 crore and Rs 15,673 crore cash respectively in their respective portfolios. Quant Mutual Fund had around Rs 12,614 crore cash which was 13.74% of the total AUM. Axis Mutual Fund had Rs 10,152 crore cash in its portfolio.

Kotak Mutual Fund was sitting on Rs 5,274 crore cash pile as on September 30. Aditya Birla Sun Life Mutual Fund had Rs 3,207 crore cash in its portfolio which was 2.01% of the total AUM.

Mirae Mutual Fund had Rs 1,830 crore cash in its portfolio which was 1.16% of the total AUM. The equity AUM of the fund house was Rs 1.55 lakh crore as on September 2024. Old Bridge Mutual Fund, relatively a new entrant in the mutual fund industry, had Rs 84.02 crore cash in its portfolio which was 10.40% of the total AUM. Shriram Mutual Fund and Groww Mutual Fund had Rs 9.32 crore and Rs 5.74 crore cash respectively in their portfolio in September.Based on the percentage funds, the cash holding by PPFAS Mutual Fund was the highest. The total cash holding by the fund house was 18.06% of the total AUM. The next in the list was Quantum Mutual Fund which had a cash allocation of 14.76% of the total AUM.

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SBI Mutual Fund had the highest equity AUM of Rs 7.03 lakh crore, followed by ICICI Prudential Mutual Fund which had an equity AUM of Rs 3.75 lakh crore as on September 2024.

Fund managers are allowed to keep a part of their portfolio in cash to meet events like redemptions or make investments when they see a possible opportunity in the market.

The increase in cash holdings as a percentage of the assets by mutual funds indicates that the fund houses are moving cautiously in the current market scenario. New fund houses like Samco may typically try to hold cash and wait for bargain hunting in a likely correction. Some conservative mutual funds like PPFAS always hold cash when they sense the market has become expensive.