Manpower woes hit MF industry

What's a fund without a fund manager? A rudderless ship. And that's the biggest problem the mutual fund industry is grappling with. CNBC-TV18's Mitra Joshi and Vidhi Godiawala report.

Low retail participation is not the only problem the mutual fund industry is facing. Fund houses are struggling as fund managers are walking out in droves.

Nearly 90 fund managers have exited the Industry since the ban on entry loads came into effect. According to the MF-industry-tracking firm Value Research, almost 48 fund managers have left the industry in the last 12 months alone.

Choosing lucrative segments like private equity, investment banking and hedge funds. Of course, there are some, who have chosen off-beat fields like pro-biotic farming as well.

Experts, like Arjun Parthasarthy who quit his fund manager job with IDFC Mutual Fund to work on a website, says low profitability prompted the move.

Parthasarathy says "There is a question of profitability, apart from 3 to 5 AMCs that run large equity schemes, the other X number of AMCs have very low profitability or not at all profitable."

Add the fact that a fund manager's job is monotonous and stressful, and  the grass on the other side of the fence certainly begins to look, and feel, a lot greener... especially after 20-odd years in the industry.

Krishnamurthy Vijayan, former CEO of IDBI MF says,