Aditya Birla Sun Life AMC says it is in an advantageous position

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Days ahead of its IPO, Aditya Birla Sun Life Asset Management Company (AMC) has said the IPO price band has been fixed keeping investor interest in mind. Aditya Birla Sun Life AMC’s initial public offer (IPO) is opening on September 29 and the three-day issue will close on October  1.The price band has been fixed at Rs 695-712.

Overall cost structure reduced

To a particular question on whether the company would you look at inorganic growth for market share, he replied that “at this point of time there is no such plan”. Pointing out the fund house’s past buyouts, he said the firm had acquired Apple MF, Alliance MF and ING MF over the past few years. He said the fund house is open to the idea if the opportunity exists, depending upon valuations, board and shareholder approval, etc “Having said that, we remain predominantly focused on organic growth,” he is quoted as saying the newspaper report.

Balasubramanian also welcomed competition from fintech players saying more players will help the industry grow. Stating that the new players are not a threat, he said Aditya Birla Sun Life AMC is in advantageous position with its track record of 23 years. “We will continue to grow our size and assets,” the business daily quoted him as saying.

To another query on SEBI’ focus on cost rationalisation impacting  the profitability, he said there has been reduction in overall cost structure as well as expense structure. The fund house has been building equity while adding more customers along with a strong book of SIPs, he said, adding that the AMC has been gaining scale without increase in extra cost. “Therefore, operating leverage helps in improving overall profitability and revenues.”

Balasubrmanian said Aditya Birla Sun Life AMC’s market share has increased from 5% to 9.1%. It will deepen its presence in B-30 (beyond-30 cities) and expand its customer base. He said the fund house will expand its branch and distribution networks. Wealth creation via SIP will remain a focus area. “Our approach will be more granular in both products as well as the ownership of customers,” he said.