In spite of 17 years of operations, Taurus has a compact portfolio of products compared to its peers as it believes in launching meaningful funds which connect with investors and distributors alike. Waqar Naqvi, CEO, Taurus Mutual Fund shares his strategy and plans in this interview.
Taurus MF has seen a spike of Rs 2,461 crore AUM in April-June quarter. What has contributed to this growth?
We have delibrately taken a more difficult path of growing assets across all categories and not relying excessively on banking money. This approach has paid off. As of now, we manage only Rs 1,500 crore of banking money. It took us some time to achieve this. I think the investors have confidence in our ability to perform and deliver good performance.
What’s your equity component of the total AUM?
Equity assets are 7 per cent of our total AUM.
Would your focus be on launching new funds or on the existing funds?
We promote our flagship funds on an ongoing basis. We are also looking to launch new funds.
What kind of funds are in the pipeline?
We are not a great believer in sector funds. However, we are positive on the banking space. We will launch a banking and financial services fund because banking is a reflection of the broader economy which lends to all sectors. We are also planning to launch a balanced fund. We are awaiting SEBI approval for the same. One needs to launch funds with some responsibility in this business. Our Ethical Fund was not a ‘me too’ fund. We came up with a MIP Fund which has a gold component and it has been performing well.
There is lot of buzz around SIPs. How many SIPs are you adding per month?
We started focusing on SIPs only this year because we thought paying higher upfront commission would invite churn. AMCs are paying more than what they are earning from SIPs. We are participating in SIPs with our trusted distributors. Every month, we are adding around 3000 new SIPs.
Which channel of distribution do you see growing in the future?
I think banks’ share in MF distribution will go up marginally in the future. Their share has already gone up in the last three to four years.
How many active IFAs do business with you?
Around 1000 IFAs give us business every month.
What engagement programs do you plan to have for IFAs?
We call global mutual fund celebrities to address our distributors. We also do a lot of cultural and sports activities with IFAs at the regional level. Apart from this, we conduct meetings with the IFAs’ clients, relationship managers and run contests.
Some of the infrastructure funds have exposure to stocks which are beyond the definition of infrastructure companies. What is the reason for this?
Our Taurus Infrastructure Fund is a five star rated fund. If our infrastructure fund underperforms during certain market cycles, it is only because we do not hold any non-infrastructure stocks. Some fund managers deviate from the theme only to provide some returns. Whether deviating or staying focused on the theme is a debatable issue. Even though the offer document allows investments in non-infrastructure stocks, we have tried not to deviate from the infra theme.
SEBI recently announced incentive structure for distributors. What’s your take on it? Will it help encourage new IFAs to join the industry?
It will help the existing IFAs. It will stop IFAs from moving out of the industry. IFAs focusing on HNIs have not been much concerned about the scrapping of entry load. The incentive structure proposed by SEBI addresses the IFA segment which was hit the hardest by the entry load ban.
