LIC Mutual Fund Asset Management (LIC MF) will undertake rationalisation of products and operations after the proposed integration of IDBI Mutual Fund with itself.

The fund house is evaluating various options to be taken up after the proposed acquisition of 51 per cent stake by its parent LIC in IDBI Bank, Raj Kumar, CEO, LIC MF, has said.

In August this year, the Union Cabinet had cleared a proposal allowing LIC to acquire a majority stake in IDBI Bank.

LIC MF worked out different modalities for integration. “The combined AUM of the two entities will be ₹29,000 crore. However, about 5-6 per cent investors may prefer to opt out after completion of the deal, subject to regulatory approvals,” Raj Kumar, who was here at LIC’s regional headquarters on Wednesday, said.

LIC MF and IDBI MF now have ₹18,000 crore and ₹11,000 crore, AUM respectively. While LIC MF has about 180 employees, IDBI MF has over 250 employees, he added.

“We will take advantage of the distribution channel of IDBI MF, which uses the IDBI branch network,” Raj Kumar said.

Eyes ₹25,000-cr AUM

LIC MF is hoping to close the current financial year with an AUM of ₹25,000 crore. It is also planning to step-up focus on retail segment customers. This will include measures such as launching new funds, daily SIPs, any day SIPs, and upgradation of IT infrastructure, among others, Raj Kumar said.

IDBI AMC and IDBI MF Trustee Company are subsidiaries of IDBI Bank. According to regulatory norms, LIC will be required to merge IDBI MF with its own fund house after completion of the deal.

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