The country’s largest asset management company SBI Mutual Fund has received approval for its IPO from market regulator SEBI. According to sources, this information came to light on Friday.
Business News: SBI Funds Management Limited (SBI Mutual Fund), one of India’s largest asset management companies, may soon list itself in the stock market. According to reports, the company has received preliminary approval from market regulator Securities and Exchange Board of India (SEBI) and the IPO may be launched next month.
The size of this proposed IPO is said to be around Rs 13,000 crore, which will be one of the largest public offerings in India’s asset management sector.
IPO will be completely offer for sale (OFS)
According to the Draft Red Herring Prospectus (DRHP) filed in March, this IPO will be entirely an Offer for Sale (OFS). No new shares will be issued in this. Overall, about 20.37 crore equity shares will be sold. The major shareholders selling stake in this will be:
- State Bank of India
- Amundi India Holding
Under this process, existing investors will reduce their stake, while the company will get an opportunity for listing in the market.
Big change in AMC sector
After the listing, SBI Mutual Fund will join the ranks of India’s leading listed asset management companies. There are currently several large companies already listed in the sector, including:
- HDFC Asset Management Company
- Nippon Life India Asset Management
- UTI Asset Management Company
- Aditya Birla Sun Life AMC
- ICICI Prudential AMC
This listing is expected to increase both competition and transparency in the Indian AMC sector.
Company history and development
SBI Funds Management Limited was established in the year 1987. Later in 1993 it was registered with the Securities and Exchange Board of India (SEBI). In 2011, the company formed a joint venture with French asset management firm Amundi, increasing its global reach and expertise. Currently the structure of the company is as follows:
- State Bank of India stake: 61.98%
- Amundi stake: 36.40%
- Strong Assets Under Management (AUM)
SBI Mutual Fund is India’s largest asset management company, currently handling assets under management (AUM) of approximately ₹12.70 lakh crore. This figure is higher than any other mutual fund house in India, reflecting the strong confidence and wide reach of the company among investors. The company’s portfolio includes:
- 52 equity funds
- 23 debt funds
- 13 hybrid funds
- 4 other schemes
Overall the company is operating more than 90 schemes. Listing of mutual funds and asset management companies is common globally, but an IPO of this scale in India indicates the maturity of the market. This shows that the Indian financial system is now getting closer to global investment standards.
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