UTI Asset Management Company has filed draft red herring prospectus with markets regulator the Securities and Exchange Board of India (Sebi) to raise funds through initial public offer.
The public issue consists of an offer for sale by shareholders including State Bank of India, Bank of Baroda, LIC, Punjab National Bank and T Rowe Price.
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The first three shareholders will sell 10,459,949 shares each, while the other two will offload 3,803,617 shares each.
Media reports peg the offer for sale size at around Rs 3,800-4,800 crore, which would value the asset manager at around Rs 12,000-15,000 crore.
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UTI AMC is the seventh-largest asset management company in India in terms of mutual fund QAAUM (quarterly average assets under management) as of September 30, according to Crisil.
SBI, LIC, PNB and BoB each hold 18.5 per cent stake in the asset manager, while the remaining stake is held by US-based T Rowe Price.
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UTI AMC manages 178 domestic mutual fund schemes, comprising equity, hybrid, income, liquid and money market funds as of September 30.
It manages the domestic mutual funds of UTI Mutual Fund, provide portfolio management services (PMS) to institutional clients and high net worth individuals (HNIs), and manage retirement funds, offshore funds and alternative investment funds.
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Kotak Mahindra Capital Company, Axis Capital, Citigroup Global Markets India, Bank of America Securities, ICICI Securities, JM Financial and SBI Capital Markets are the bankers to the issue.
The asset manager will be the third in the industry after Reliance Nippon Life Asset Management and HDFC Asset Management to go public.
CRISIL projects QAAUM of the Indian mutual funds industry to grow at a CAGR of 17-19% between September 30, 2019 and March 31, 2024, reaching a total of Rs 54-58 lakh crore.
The ratings agency expects the key drivers of that growth to include the anticipated pick-up in economic growth, growing investor bases across geographies, higher disposable income levels and investable household surplus, increases in aggregate household and financial savings, increases in geographical penetration as well as better awareness, ease of investing, digitalisation, and perception of mutual funds as long-term wealth creators, driven in part by government initiatives.
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