The Hindu Business Line : `Funds know they will miss an opportunity if they don't set up base in this country'

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Kolkata March 4 Newcomer Lotus India MF is aware that the asset management industry will, in the days to come, be more competitive than ever. "With so many new funds set to start business in the country, the dynamics of the market will undergo conclusive changes," says Mr Ajay Bagga, CEO. Here, in a free-wheeling interview, he opens his mind on a range of issues.

A lot of new players will arrive soon. Has the market for funds suddenly turned super attractive?

It is not that India, with its billion-plus population and growing investment culture, has become a hot destination overnight. A number of factors, which have merged into one big compelling condition, have appealed to the international investment management community. Specifying these factors will make it sound repetitive.

The crux of the matter is that funds know they will miss an opportunity if they don't set up a base in this country. In fact, the growth potential here was never more acutely felt than now. Consider the spread of our equity investing habit, and you will realise that popular perceptions about India are not out of place.

What are your plans to grow your business here?

We intend to unveil a range of products as we go along. The basic idea is obvious: investors should get an array to choose from. They have already seen the first few of these. Now we are adding to the equity side, starting with two new funds, one of which will follow contrarian strategies. We are lining up other proposals, including those on the debt side.

Talking about debt, we think many investors, aware of the volatility in the debt market, will for the time being want to remain with shorter duration assets.

Do you have any particular business model in mind?

Well, a number of players are already doing business here, each trying to capture a piece of the action. Some of them have well over a decade behind them. But as I said before, they will face competition from the several global bigwigs that aim to start operations here.

With this in the background, we will try to distinguish ourselves. However, this will not be done at the cost of growth in the popular sense. A fairly strong nation-wide network has been set up. This should provide us the required footprint.

Do you plan to tap your overseas links?

We hope to gain from their experience. On this front, an organisation like ours is better placed than so many others. Let me tell you here that a few of the older players, including those with public-sector backing, have either already formed partnerships or are in the process of doing so. Now, coming back to our main point, our stated objectives are clear to all.

Lotus is aware of the specifics that India is blessed with. I am referring to such aspects of the economy as corporate earnings growth, quite a few booming sectors and the relative attractiveness of the Indian market (in the context of emerging economies).

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