 "Mahindra Mutual Fund bets on rural India for growth")
Mahindra Mutual Fund is betting on the semi-urban and rural markets in India for growth and expansion.
The company, a part of the diversified Mahindra Group, would also leverage the extensive presence of its parent company Mahindra Finance in the upcountry markets across the states, Mahindra Asset Management Company head (sales and distribution) Jatinder Pal Singh told Business Standard in Lucknow.
He said the mutual fund industry was largely an urban phenomenon with the top 15 cities in India contributing almost 85% of the total Assets Under Management (AUM) of about Rs 14,40,000 crore in the domestic industry.
"Even in urban markets, there is lack of awareness amongst people about the financial markets and investment products," he claimed adding the combined mutual fund corpus was only 3-4% of the total savings.
"The tier II and III towns would be our focus area along with bigger centres," he added.
The company was granted licence in February 2016 by the Securities and Exchange Board of India (SEBI).
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In the current phase, it is expanding in the Northern and Western regions comprising Uttar Pradesh, Bihar, Madhya Pradesh, Punjab, Gujarat, Maharashtra etc. In the second phase, the company plans to expand base in the Southern and Eastern states,
"In the next two years, we plan to ramp up the number of our financial advisors to about 10,000 from 2,000 at present," Singh informed.
Meanwhile, Mahindra Mutual Fund has launched an open ended equity linked savings scheme 'Kar Bachat Yojana' with three year lock-in period. The new fund offer opens on August 22 and closes on October 7, 2016.
The scheme aims at generating long-term capital appreciation through a diversified portfolio of equity and equity related securities.
"In the current fiscal, we would launch more products subject to SEBI approval," he said.