The competition in the mutual fund industry is likely to get fiercer with market regulator Securities and Exchange Board of India (SEBI) is considering nine entities that have shown interest, reported Business Line.
Some of the financial services firms that have applied include Emkay Global Financial Services, Angel One, Abira Securities, PhonePe, Helios Capital, Alchemy Capital Management, Abira Securities, Capitalmind, Old Bridge Capital Management, Unifi Capital and Wizemarket Analytics.
Rakesh Jhunjhunwala-owned Alchemy Capital which made a splash in the aviation industry with launch of his own airlines Akasa, has been waiting for mutual fund licence since last January.
Last year, SEBI gave in-principle approval to Bajaj Finserv, Zerodha Broking and Frontline Capital Services to launch mutual fund.
The 44-member mutual fund industry registered an average asset under management of ₹38-lakh crore in the June quarter. Interestingly, the top-10 fund houses account for 80 per cent or ₹30.64-lakh crore of the AUM. The next 10 mutual fund houses have an asset of ₹5.84-lakh crore under management.
The rush for launching mutual fund business increased ever since the SEBI eased profitability norms for sponsor companies two years back to facilitate innovation and enhance reach to more investors.
SEBI said tech-enabled financial solutions, sponsors that are not fulfilling profitability criteria at the time of making application, shall also be considered eligible to sponsor a mutual fund subject to having a net-worth of not less than ₹100 crore for the purpose of contribution towards the net-worth of the Asset Management Company.