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L&T Mutual Fund: Acquiring Meaning

Distributors should not perceive a paperless environment as a threat. It is a means to add scale, reduce cost and create time for value addition to the customer.

L&T Finance, the financial services arm of L&T, acquired DBS Chola Mutual Fund to fit into its growing aspirations. L&T had made the acquisition to help synergise its existing financial services business. “We have expanded our presence from 19 locations in February to almost 55 now, improving our ability to establish our retail footprint,” says an excited Sanjay Sinha, CEO, L&T Mutual Fund.

Disappointing AUM growth: The gross mobilization figures have been reasonably high and gives the impression that the impact has been mixed. This is a prima facie impression, but it masks the fact that around 14 lakh folios shrunk during this period when the stock market and equity funds did well. In the future, the credibility of the distributor as an advisor needs to be capitalized.

State of the market: The convergence of high liquidity and absence of negative events have brought the market to such elevated levels in a tearing hurry. While valuations are not cheap, they have not gone into stratospheric levels too. We need to consolidate at these levels for confidence to build up.

The road ahead: The recent launch of our closed-end debt funds have got a good response from retail and institutional investors and we believe that there is a large scope for product innovation in this space.