The Hindu Business Line : Smaller funds seeking Indian foray set house in order

They may not be the big boys in the international asset management space, but Shinsei, Mirae, Robeco and some of the other smaller outfits that are hoping to roll out their operations in India are quickly putting their houses in order.

A number of players, having already hired key personnel, are currently seeking to recruit people in regional centres. Some of them are also finalising arrangements with major service providers.

Shinsei, the Japanese firm that has an on-going tie up with UTI Mutual Fund, is known to have roped in Mr N. Sethuram, who was till recently the Chief Investment Officer of SBI Funds Management, in a senior position.

Developing market

Shinsei, for the record, has just announced the formation of a joint venture with UTI International, a 100 per cent subsidiary of UTI Asset Management Co. To be based in Singapore, the joint venture will be headed by Mr A.K. Sridhar, the current CIO of the fund house.

Mirae, the Koran outfit that has lately set up shop in the country, is looking at a smooth launch in a rapidly developing market. Mr Arindam Ghosh, who heads the show, noted Mirae is well on its way to firm up critical aspects of the business.

The Indian scenario for mutual funds has evolved considerably in recent years, leading to expectations that the growth trend will be sustained, he felt.

“We have been engaged in hiring the key people for the AMC and have nearly completed the first level of recruitment. The second level of hiring both at head office and branches is also underway. We hope to complete this exercise by end of September,” he said. Mirae, which accounts for 35 per cent of the Korean market for equity funds, manages $78 billion worldwide.

Robeco’s operations

Robeco, which has tied up with Canara Bank for its Indian foray, is learnt to have found a chief executive in the former DBS Cholamandalam MF boss, Mr Rajnish Narula.

Mr Narula, who had quit DBS Chola a few weeks ago, however, said he did not wish to comment on the matter, when Business Line reached him for his observations.

In March, Robeco had signed a deal to buy 49 per cent in the Canara Bank-promoted Canbank Investment Management Services, a move that will entail an investment of well over Rs 100 crore.

While no Japanese or Korean asset management company is present in India, Robeco’s entry — it is based in the Netherlands — will rank it with other players that are headquartered in Europe. These include ING, BNP Paribas and Societe Generale. SocGen and BNP Paribas have tied up with SBI Mutual Fund and Sundaram Mutual Fund, respectively.

Stagnation

The entry of these funds, as well as that of players like UBS, will substantially help increase the number of asset management companies in the country. At the moment, there are a little over 30 funds in operation.

The number of players seem to have remained stagnant for quite a while, concedes Mr A.P. Kurian, Chairman, Association of Mutual Funds in India. However, his rationale is, “A few funds like AIG and JP Morgan have indeed come in in recent days. At the same time, there have been some takeovers too. This has kept the overall figure low.”.

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