One of India’s oldest fund managers has started a new mutual fund in a market already crowded by big legacy players. For Helios Capital founder Samir Arora, however, it is a familiar turf and "one more avenue to offer the fund management" that he has been doing for so long, and in his words, "quite reasonably well".

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"We are not businessmen; we are fund managers. And this is just one more avenue to offer the fund management that we have done for so long and quite reasonably well. And I was in Alliance, I was their first employee and I was more or less the first employee of any company in this business in 1993. I totally enjoyed that first stint, and I wanted to relive that," Arora told CNBC-TV18.

In early August, Arora informed on X platform (formerly known as Twitter) that his firm had received markets regulator Sebi's approval to launch a mutual fund business. Helios Capital, which is in the business of portfolio management services, applied for a mutual fund license with Sebi in February 2021.

Lauded as a “rockstar” for his performance as the Chief Investment Officer of Alliance Capital's Indian mutual fund business, Arora isn't perturbed by the burden of expectations as he re-enters the mutual fund industry after two decades.

“I'm too humble to say a rockstar. It was a good performance. We became number one in those days in Alliance while we were competing with all the big daddies of India with big partners, whereas Alliance was 100% foreign-owned in that sense. We hope to relive that whole experience,” Arora told CNBC-TV18.

However, Arora-led Helios Capital is not alone in venturing into India's mutual fund markets.

Discount brokerage firm Zerodha also recently got Sebi's nod to set up an asset management company. Earlier this year, diversified financial services group Bajaj Finserv also entered the highly competitive mutual funds business.

Billionaire Mukesh Ambani-led Reliance Group's Jio Financial Services and US-based BlackRock Inc have also announced a joint venture to launch asset management services in India. Jio Financial Services was demerged from Reliance Industries on July 20.

An opportunity or an overcrowded space?

The Indian mutual fund industry has been growing at a fast pace with the Systematic Investment Plan (SIP) inflows in September 2023 reaching an all-time high of Rs 16,042 crore, marking a notable increase from the previous month's Rs 15,814 crore. The number of SIP accounts hit an unprecedented high, reaching 7.12 crore in September, compared to 6.9 crore in August 2023.

The SIP Assets Under Management (AUM) also saw a substantial increase, reaching Rs 8.72 lakh crore in September, up from Rs 8.47 lakh crore in August 2023. Not just that, the number of new SIP registrations in September 2023, soared to over 36 lakh marking the highest ever figure recorded, demonstrating the growing interest and participation of retail investors.

The equity segment in September received a significant boost with the introduction of six new fund launches, collectively accumulating Rs 2,503 crores in investments, said Melvyn Santarita, Analyst – Manager Research at Morningstar Investment Adviser India.

With that said, one needs to consider that there are more than 40 fund houses, but the top 10 fund houses or AMCs (Asset Management Companies) manage over 70% of the mutual fund assets in India.

(Edited by : Amrita)

First Published:Oct 16, 2023 2:58 PM IST