Ved Prakash Chaturvedi, Chief Executive - Capital Markets & Investment Management Group, L&T Financial Holdings, assures investors and distributors that the transition will be beneficial to all stakeholders.
The question foremost on everyone’s mind is – will the Fidelity Equity Fund Management Team continue with L&T Mutual Fund?
The answer to this question is an unequivocal yes but let me answer in detail. Talent is a very important factor, particularly, in the fund management area. L&T as a brand is quite used to managing high quality talent to create high-quality performance. As far as equity fund management is concerned, both organizations are committed to ensuring that the investors continue to have the same experience. The Fidelity Equity team will be a part of L&T Mutual Fund team for a period of time to ensure continuity.
There is great complementarity between the two organizations and I am sure that we will build one of the great fund management stories of India in the days to come. Together, the team is a formidable combination of expertise in equity, debt, and distribution across channels. The value system of the two organizations are very similar. Over a long period of time, organizations outperform because of high values, quality processes, systems and, of course, people.
Will you follow the same approach and processes which Fidelity has followed?
Both organizations have their own strengths. We have examined certain key processes and systems,and found huge similarities. I am certain that both the teams will learn from each other. We expect continuity in approach and processes in all areas.
Will the sales & marketing team be a part of L&T Mutual Fund, given the fact that you already have a full-fledged team?
Yes, indeed. Given our complementary business, both the teams will continue to service customers in the same manner that they have been doing in the past. In fact, we intend to work with these very teams for many years.
What is your message to distributors and investors?
We will do everything in our power to ensure that investor interest is protected. A detailed integration plan has been worked out, which takes care of every distribution partner. The values and beliefs of the two organizations are very similar and we feel that the process of integrating the two organizations will be smooth and will ultimately deliver additional value to all stakeholders.
How did the Fidelity acquisition fit into the overall strategic vision of L&T Finance Holdings?
L&T Finance Holdings has a positive long-term, strategic view of the fund management industry. While this industry has gone through some difficult times in the recent past, you will see strong growth and robust penetration in the years to come. With this vision, we at L&T Mutual Fund were in the process of building and enhancing our capabilities. A huge amount of effort has gone behind building,upgrading our processes and systems and recruiting senior management team. As a strategy, we have built capacity and capabilities to build and grow this business.
What will you do with your existing schemes? Will you merge them?
We will examine each aspect of the integration of the two organizations on its own merit, with one filter: that it should cause least amount of discontinuity and disturbance to investor interest. All decisions will be taken in order to enhance value to our investors.
The mutual fund industry has evolved over the years. What opportunities do you see in this market?
The industry has done very well in these difficult times. Fifteen years ago, there was virtually no private sector mutual fund India and today the private sector is dominating the industry.
The industry will now embark on its next phase of growth. More investors will come to this industry as the industry has given good returns and service to investors.
I see four megatrends – emergence of a new, younger generation of investors; advent of online technology; greater awareness about benefits of mutual fund and soaring financial aspirations. These trends would lead to mutual funds becoming a ready vehicle for achieving life goals.
The next five years will be very positive for the industry. More foreign investors will flock to India. The Indian pension fund savings, a small amount of which is invested in capital markets, will come to markets in a bigger way and the mutual fund industry is best suited to capitalize on this opportunity. I see a hugely positive future for the Indian mutual fund industry.
