The board of directors of HDFC Asset Management Company, the sponsor of HDFC Mutual Fund, has cleared a proposal to initiate the process of filing for its initial public offer.

HDFC Mutual Fund will become the second fund house to list after Reliance Mutual Fund, the IPO of which was subscribed 81 times earlier this month. As of September quarter, HDFC MF is the second-largest fund house with assets worth ₹2.69 lakh crore under its management.

The promoters of the asset management company — Housing Development Finance Corporation and Standard Life Investments — have also, in principle, approved the IPO by offering their shares to the public in one or more tranches. Post dilution in tranches, the shareholding of HDFC and SLI in HDFC AMC will be at least 50.01 per cent and 24.99 per cent, respectively, said HDFC MF in a statement on Thursday.

Standard Life Aberdeen plc (the promoter of Standard Life Investments), HDFC and HDFC AMC also confirmed their intention to enter into a collaboration agreement to work together to develop new products in India, which they believe will further enhance their successful long-term relationship.

Unlocking biz value

Deepak Parekh, Chairman, HDFC AMC, said the listing would unlock value for the shareholders and provide investors an opportunity to participate in the emerging asset management space within the group.

Milind Barve, Managing Director, HDFC AMC, said the Indian asset management industry has seen strong inflows with increasing awareness of mutual fund products.

The improving penetration levels of mutual fund products provide an interesting opportunity to channelise investments more productively, he said.

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