Tata-Mistry face-off: LIC Mutual Fund on a ‘wait and watch’ mode

KR Srivats New Delhi | Updated on January 27, 2018 Published on November 20, 2016

Not looking to add more equity positions in listed Tata Companies: CMO

LIC Mutual Fund (LICMF) is not looking to add more equity positions in those listed Tata Companies in which it is currently invested in, a top official of the fund house said.

It has decided to adopt the ‘wait and watch approach’ to see how the ongoing dispute between Ratan Tata and Cyrus Mistry pans out in the coming days, Rajesh Patwardhan, Chief Marketing Officer (CMO), LICMF, told BusinessLine here.

“Like our parent (LIC), we are also on a wait-and-watch mode.

We are quite hopeful that gradually the dust will settle down on this (boardroom dispute)," he said.

LIC Mutual Fund is currently invested in few listed Tata Companies including Tata Consultancy Services (TCS). Institutional investors are expected to play a critical role at the Tata Group convened extraordinary general meetings including Tata Steel, Tata Motors and TCS to seek shareholders' nod to oust Mistry and Nusli Wadia.

AUM growth

Meanwhile, LIC Mutual Fund — which is now entirely owned by Indian entities (mainly LIC) — will strive to grow its assets under management (AUM) to ₹30,000 crore by end March 2017 from the current AUM level of ₹20,000 crore, Rajesh said.

The aim will be to take the average AUM (AAUM) to ₹20,000 crore by March 2017 from ₹16,000 crore now.

Out of the expected ₹30,000 crore AUM, at least ₹5,000 crore will be equity-oriented funds, he said. Rajesh, who assumed charge as CMO in February 2016, also said that the current demonetisation will have positive impact on the mutual fund industry and LIC MF also expects to ride on the benefits, which is expected to bolster AUM.

Currently, LIC has a 45 per cent stake in LIC MF. While LIC Housing Finance has 39.3 per cent stake, GIC Housing Finance holds about 11.7 per cent stake.

Financial services major Nomura, which was invested in LIC MF between 2011-16, does not have any equity holding in the fund house.

Rajesh added that LIC MF plans to ride on the goodwill enjoyed by LIC to promote LIC MF's mutual fund products in at least 200 villages this year.

He also said that LIC MF will soon rope in Standard Chartered Bank as its unique payment interface (UPI) partner.

Published on November 20, 2016

A letter from the Editor

Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.