Meet the new kings of the Indian MF distribution world

An analysis of the assets under advisory (AUA) of India’s top 10 distributors shows that these distributors have grown from Rs.1.43 lakh crore in FY 2013-14 to Rs.3.72 lakh crore in FY 2017-18, a massive jump of 161% in five years. Similarly, the gross commission of these distributors went up by 244% i.e. from Rs.1223 crore in FY 2013-14 to Rs. 4237 crore in FY 2017-18.  These distributors account for 17% of the total industry’s AUM as on March 2018.

Experts say that the resurgent interest in mutual funds has bumped up the volume and scale up the business of these distributors.

Cafemutual decided to revisit the top 10 distributors list to understand if the top 10 distributors of FY 2013-14 were able to hold their positions over the next five years. We shortlisted the list of top 10 distributors based on their gross commission over the last five years and found that three new entrants in the list.

SBI Bank, ICICI Securities and Prudent Corporate Advisory have made it to the list of top 10 mutual fund distributors in terms of gross commission in FY 2017-18. These distributors have replaced IIFL Wealth Management, SPA Capital Services and HSBC Bank who were among top 10 distributors in FY 2013-14.

While SBI has witnessed 19x growth in its gross commission i.e. from Rs.29 crore in FY 2013-14 to Rs.552 crore in FY 2017-18, ICICI Securities and Prudent Corporate Advisory have recorded healthy growth of 3x and 5x, respectively. ICICI Securities gross commission grew from Rs.75 crore in FY 2013-14 to Rs.317 crore in FY 2017-18 while gross commission of Prudent Corporate increased from Rs.35 crore in FY 2013-14 to Rs.218 crore last fiscal.

Dinesh Khara, Managing Director, SBI attributed this growth to their focussed approached. “We have imparted necessary trainings to our existing employees since 2015. We have equipped them with requisite skills such as understanding needs of customers, product knowledge and risk assessment to distribute third party products. Also, our ‘SBI Mitra’ app has helped us engage with our existing customer in a meaningful way.”

We also analysed the gross commission data of top distributors to shortlist the list of top 10 individual distributors. Over the last five years, five IFAs - Ranjan Panigrahi, Krushna Finserv, Naik Wealth, MFA Consulting and Gaurav Ganpule have replaced RK Agarwal, Sameer K Lakhani, Brain Point Investment, Comsol Financial and KNS Consulting to be on the list of the top 10 individual mutual fund distributors.

Top 10 distributors – Overall (Across all categories)

Top 10 distributors - IFAs