SBI not planning further stake sale in SBI Funds Management, says CS Setty
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State Bank of India (SBI) has no plans to further dilute its stake in SBI Funds Management, maintaining over a 55% ownership after a recent IPO that raised Rs 9,812 crore. The IPO, which was entirely an offer for sale, reflects SBI's strategy to enhance its market presence without significant capital dependency, as the asset management firm is valued at over Rs 4 lakh crore. Following the listing, shares of SBI FM rose nearly 7%, indicating strong investor interest in the Indian mutual funds sector.
State Bank of India is not looking to dilute its stake further in its asset management arm SBI Funds Management, a top official said on Tuesday.
Speaking at the listing ceremony of SBI FM, the largest asset manager in the country, SBI chairman CS Setty said, "At this moment, we are not looking for any more dilution".
He quickly added that capital markets regulator SEBI's minimum public holding norms will dictate any stake sales from here on.
SBI sold around 6 per cent of its stake in the asset management company as part of the IPO process and now owns over a 55 per cent stake.
Its joint venture partner Amundi, a global asset manager, diluted its nearly 4 per cent stake and owns a 32.5 per cent stake. Put together, both the promoters own around an 88 per cent stake, which has to come down in phases to 75 per cent.
The Rs 9,812-crore IPO was one of the biggest issuances to hit the market in recent times, which has seen sharp volatilities in the market, especially due to geopolitical swings. The issue entirely consisted of an offer for sale from the existing shareholders and did not have any fresh issuance component in it.
Setty said the business built over nearly two decades is not so capital dependent, and the purpose of going for a public listing was also to systemically better move where the largest of the fund houses is listed.
Over the years, the country's largest lender has invested around Rs 6,000 crore in the asset management company, which is now valued at over Rs 4 lakh crore.
When asked about Amundi's strategy with regard to the partnership going forward, the French company's deputy chief executive Nicolas Calcoen expressed happiness at the journey till now with SBI and that it will be there alongside the lender for a very long time.
Shares of SBI FM debuted with nearly 7 per cent gains on the bourses on Tuesday, with analysts attributing it to an urge among investors to capitalise on the potential of the Indian mutual funds space.
Original Article
Published on Hindu BusinessLine