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2022 is ending soon. Can you give us a sneak peek into your 2022?
We were able to sustain our pace of growth in 2022. We had reached a landmark of Rs. 10,000 crore in AUM during the year. This has enabled us to remain a profitable business. Over 11 months during the year, our fund house witnessed a 21% increase in the number of investor folios, with about a 22% increase in unique investors.
Furthermore, our efforts of actively collaborating with distributors other than Union Bank resulted in a consistent increase in our AUM share through non-associate distributors and direct channels. We also recorded a significant 33% increase in our active distributor base over the course of a year.
As our organisation grew over time and our business model evolved, we felt the need to redefine our brand identity. Hence, in the new year, we are launching our new corporate website and our new brand logo. This was a very exciting project to work on in 2022.
What trends do you think that the MF industry should watch for in 2023?
The year 2022 saw a strong influx of retail investors, especially through SIPs. We expect that this tendency will continue in 2023. With India being one of the world's fastest-growing large economies, we expect robust FPI interest. However, given the looming macroeconomic uncertainties, if there is a significant correction or consolidation in the equity markets, the interest from retail investors will suffer a temporary knock. As a result, the mutual fund industry needs to take steps to educate investors on the necessity of staying invested for the long term.
Another key trend the industry may witness is investors' inclination towards long-term debt funds as the interest rate cycle is expected to peak in another two to three years.
What are the two key lessons that the year has taught you?
The name of the game is uncertainty. For instance, we thought markets were expensive at the beginning of the year but they remained expensive for a considerable time throughout the year. So, a key takeaway is that markets may prove you wrong longer than expected.
Furthermore, we realise that macro and micro events are constantly evolving. Hence, one should always be prepared for the unexpected. For example, nobody expected that the war in Ukraine would last this long but it has and has had a significant effect on the global economy and equity markets. Hence, being agile and reacting correctly to such unforeseen events is very important. This reinforces our belief in being process-driven and focusing on the long-term.
What are your aspirations for the coming year?
Delivering value to the investors is our key goal. In terms of fund performance, we aim to consistently be above average in every category we operate in. This should help us expand our business footprint further and broaden our investor base and distributor base. We are also contemplating an entry into other business vertical such as like alternative investment funds (AIFs).
What are the new things that you would like to implement in your professional and/or personal life?
I love to travel and this year, I was fortunate enough to travel to North East India twice. It is a place of outstanding beauty with a great diversity of flora and fauna and friendly people. I would love to keep visiting this place in future as well.
What is that one thing that you feel could have been done differently last year?
As an organization, we could have used social media and digital marketing more effectively had we been more aggressive in that space. However, we have established a strategy for this area and will be increasingly active on prominent social media platforms.
What trends do you think MFDs/RIAs should watch for in 2023?
We believe that MFDs and RIAs should keep an eye on the tendency among investors, especially newer investors, to act solely based on immediate past performance. In addition, there has been a significant proliferation of finfluencers that are not regulated. This proliferation has increased investor interest in the DIY investing trend. However, we think personalized advice and relationship management has a lot of value to offer to investors. Therefore, we feel it is important for MFDs/RIAs to remain engaged with their investors and continue demonstrating how advisory and distribution intermediation contribute significant value, enabling them to make informed long-term investment decisions.
