With the growing popularity of mutual funds among investors, a few domestic players have shown interest in launching mutual fund business.
According to SEBI’s website, two new players Geojit Financial Services and SREI Infrastructure Finance have applied to launch their mutual fund business. Altogether, six players including Frontline Capital Services, Equity Intelligence India, Samco Securities and Karvy Stock Broking are awaiting approval from SEBI to launch their mutual fund business in India.
While Geojit Financial Securities is in financial distribution business, SREI Infrastructure is already into Infrastructure Debt Fund (IDF) business and has AIF, insurance broking and infrastructure financing business. Geojit Financial Services approached SEBI in August 2018. Similarly, SREI Infrastructure Finance has applied for AMC license in February 2019.
Last year, Trust Investment Advisors and Muthoot Finance got SEBI in-principle approval to float asset management business.
SEBI rules say that the sponsor applying for a mutual fund licence must be in the financial services business for five years and needs to have a positive net worth for five years. The sponsor should have earned profits in three of the previous five years, including the latest year. SEBI conducts an on-site due diligence of sponsors before granting approval.
