A mutual fund house, also known as an Asset Management Company (AMC), is an organization that pools funds from various investors to invest in financial instruments such as equities, bonds, and other securities. Professional fund managers within these companies make investment decisions on behalf of investors, aiming to achieve the fund’s specified objectives.
The mutual fund industry in India has evolved through several distinct phases:
1. Establishment and Early Growth (1963–1987)
The journey began in 1963 with the formation of the Unit Trust of India (UTI) by the Government of India and the Reserve Bank of India, aiming to encourage savings and investment among the public. (amfiindia.com)
2. Entry of Public Sector Funds (1987–1993)
Public sector banks and financial institutions entered the market, introducing new schemes and increasing competition.
3. Emergence of Private Sector Funds (1993–2003)
The Securities and Exchange Board of India (SEBI) allowed private sector companies to establish mutual funds, leading to greater diversity in fund offerings.
4. Growth and Consolidation (2003–2014)
The industry witnessed significant growth, with increased investor awareness and the introduction of various fund categories.
5. Recent Developments (2014–Present)
Technological advancements and regulatory reforms have further shaped the industry, enhancing transparency and investor protection.
Key Constituents of a Mutual Fund House
According to the SEBI (Mutual Funds) Regulations, 1996, a mutual fund structure comprises three primary entities:
- Sponsor: The entity that establishes the mutual fund.
- Trustee: An independent body that holds the fund’s assets in trust for the benefit of investors.
- Asset Management Company (AMC): The entity responsible for managing the fund’s investments and operations.
These entities work together to ensure the mutual fund operates in the best interests of its investors. (sebi.gov.in)
Number of Mutual Funds and Schemes in India
As of the latest data, the Indian mutual fund industry comprises numerous fund houses offering a wide array of schemes. According to the Association of Mutual Funds in India (AMFI), 44 fund houses are managing a total of 1,386 schemes and the Average Assets Under Management (AAUM) of the Indian Mutual Fund Industry for December 2024 stood at ₹69,32,959 crore.
Top 10 Mutual Fund Houses in India
Based on assets under management (AUM) and performance, the top 10 mutual fund houses in India are:
- SBI Mutual Fund
- HDFC Mutual Fund
- ICICI Prudential Mutual Fund
- Aditya Birla Sun Life Mutual Fund
- Nippon India Mutual Fund
- Kotak Mahindra Mutual Fund
- Axis Mutual Fund
- UTI Mutual Fund
- IDFC Mutual Fund
- DSP Mutual Fund
These fund houses have established a strong presence in the market through consistent performance and a diverse range of investment products.
As of January 2025, the Indian mutual fund industry is poised to welcome six new fund houses, each bringing unique strengths and strategies to the market. Here’s an overview of these upcoming entrants:
1. Angel One Mutual Fund
Angel One, a prominent brokerage firm in India, has secured final approval from the Securities and Exchange Board of India (SEBI) to establish its mutual fund business. Leveraging its extensive experience in stockbroking and a vast client base, Angel one aims to offer a diverse range of mutual fund schemes tailored to various investor needs. The firm’s deep understanding of retail investors’ preferences positions it well to design products that cater to a broad audience. (business-standard.com)
2. Unifi Capital Mutual Fund
Unifi Capital, known for its expertise in alternative investment strategies, has also received final approval from SEBI to launch its mutual fund operations. The company plans to introduce niche and innovative investment products, focusing on delivering superior risk-adjusted returns. Unifi’s approach is expected to attract investors seeking differentiated investment avenues beyond traditional mutual fund offerings. (business-standard.com)
3. Jio BlackRock Mutual Fund
In a significant collaboration, Jio Financial Services, part of the Reliance Group, has partnered with U.S. based asset management giant BlackRock to establish a mutual fund business in India. The joint venture has received in-principle approval from SEBI. Combining Jio’s extensive distribution network and BlackRock’s global asset management expertise, the venture aims to offer innovative investment solutions to a wide spectrum of Indian investors. (reuters.com)
4. Capitalmind Mutual Fund
Capitalmind, a financial advisory firm specialising in data-driven investment strategies, has obtained in-principle approval from SEBI to set up its mutual fund operations. The firm plans to leverage its analytical prowess to design funds that cater to informed investors seeking transparency and evidence-based investment approaches. Capitalmind’s entry is anticipated to appeal to tech-savvy and analytically inclined investors. (business-standard.com)
5. Choice International Mutual Fund
Choice International, a diversified financial services conglomerate, has received in-principle approval from SEBI to launch its mutual fund business. With interests spanning brokerage, wealth management, and financial advisory services, the company aims to offer a comprehensive suite of mutual fund products. Leveraging its existing client relationships and financial expertise, Choice International plans to cater to both retail and institutional investors. (business-standard.com)
6. Cosmea Financial Holdings Mutual Fund
Cosmea Financial Holdings has secured in-principle approval from SEBI to establish its mutual fund operations. While specific details about their planned offerings are awaited, the firm’s entry is expected to enhance the diversity of investment products available to Indian investors. Cosmea’s foray into the mutual fund space underscores the growing attractiveness of the Indian asset management industry. (business-standard.com)
Factors supporting the emergence of new mutual fund houses include:
- Regulatory Support: SEBI’s initiatives to encourage competition and innovation in the mutual fund sector.
- Market Potential: A growing investor base seeking diversified investment options.
- Technological Advancements: The rise of fintech solutions facilitating easier access to investment platforms.
Wrapping Up
The mutual fund industry in India has undergone significant transformation since its inception, evolving through various phases to become a robust component of the financial sector. With a well-defined regulatory framework established by SEBI, the industry continues to grow, offering a multitude of schemes to cater to diverse investor needs. The entry of new fund houses further enhances the competitive landscape, promising innovative investment solutions for investors.
The introduction of these new mutual fund houses is set to intensify competition in the Indian asset management landscape, potentially leading to more innovative products and investor-centric services. Investors can look forward to a broader array of investment options tailored to diverse financial goals and risk appetites.
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