The fund houses planning to extend reach in tier 2, tier 3 and tier 4 cities
AMCs are planning to expand their base in tier 2 and tier 3 cities in the current financial year. This is in contrast to the mood a year back when, a few AMCs were looking to exit these cities as in was difficult to generate interest among IFAs and investors. Even the market had shrunk during that period and the cost had started pinching the AMCs.
Among the AMCs looking to open more branches are SBI, DSP BlackRock and Reliance.
SBI Mutual Fund is planning to add 15 new centers. “Last year we opened 14 new centers and we plan to add 15 new centers in tier 2 cities and tier 3 cities in the current financial year,” said R. S. Srinivas Jain, Chief Marketing Officer, SBI Mutual Fund.
DSP BlackRock is planning to cover tier 3 and tier 4 cities like Agra and Amritsar in the North and Madurai, Vijayawada and Hubli in the South.
“We have identified eight locations for geographical expansion this calendar year which are mainly tier 3 and tier 4 cities,” said an official spokesperson of DSP BlackRock. The company plan to spread its wings in these cities as it has observed that the number of IFAs and investors in these places have reached a critical mass. It usually spends approximately Rs. 20 lakh a year on geographical expansion.
Reliance mutual fund had added 30 new centers in the last financial year and is bullish on expansion. “We see a lot of potential in tier 2 and tier 3 cities and we plan to add a number of new centers in these places, said Sundeep Sikka, CEO, Reliance Capital Asset Management Ltd.
