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Aditya Birla Sun Life AMC receives Sebis final approval to go public

Aditya Birla Sun Life Asset Management Company (AMC) has received final approval for its initial public offering (IPO) from the Securities and Exchange Board of India (SEBI).

High-ranking representatives of the fund house confirmed the development, but gave no time frame for the start of the IPO.

“With the release we will come out very soon with the IPO,” said the official.

Sources say the IPO volume could be around Rs 2,000 billion and this will bring asset managers close to Rs 15,000 billion worth.

The fund house submitted its draft of the Red Hering Prospectus (DRHP) to the market supervisory authority in April of this year.

However, the offer document was suspended for some time due to an alleged violation at a group company.

But now SEBI has given its final go-ahead and cleared the decks for the country’s fourth IPO.

ABCL currently holds 51 percent and Sun Life 49 percent of AMC. After the IPO, the total promoter share in the fund house will drop from the current 100 percent to 86.5 percent.

Aditya Birla Sun Life AMC is currently India’s fourth largest (and largest non-bank) fund house with assets under management (AUM) of nearly 2.74 trillion rupees as of December 2020. The asset manager has maintained its fourth place since September 2011 in terms of quarterly average AUM, according to the DRHP. At the end of March 2020, the fund house was in sixth place in terms of total portfolios – 7.2 million.

The Association of Mutual Funds in India (Amfi) data shows the fund house had an average AUM of Rs 2.75 trillion in the April-June quarter. However, in July 2021, the assets surpassed the 3 trillion rupee mark.

Continuous focus on building retail customer stores with 7.2 million folios and Rs.133 trillion in retail assets, up 30% year over year. The fund house achieved an after-tax profit (PAT) of 155 billion rupees in the first quarter of the current fiscal year compared to 97 billion rupees in the previous fiscal year, a growth of around 59 percent.

The fund house recorded an improvement in the higher proportion of private investors from 40 percent in March 2016 to 46.5 percent in December 2020 – the second-best increase among the top 5 AMCs.

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