We have a long and strong track record. In fact, we are recognised as a pioneer in establishing funds in the industry. We are a very well-known and recognised brand with a strong association and trust. We have a very well-established IFA franchise and a branch network that is present in more than 400 districts, the widest presence for any mutual fund. Our recognised and much-appreciated industry education campaign are a strength as well.
However, unlike some other fund houses that have captive distribution, we do not have that. But to address that, we can work in an open-architecture model and create a dedicated banking and distribution channel, which we have done and we are seeing some success with that. Historically, we were perceived as being not technologically savvy. But I think we are changing that perception. Recently we have made significant investments in technology, and revamped our website and created a B2B app for our IFAs. We are also revitalising our brand at the same time.
Challenges ahead
At this point, the overwhelming challenge will be the fallout from global events. I fear that we will be in a period of elevated volatility and this will naturally put a lot of pressure on retail investors, who so far have shown a lot of maturity and not jumped out yet, but I think we will go through almost gut-wrenching volatility. And the second big challenge is the need for the domestic investment cycle to pick up and we believe that the government is taking measures to do that, but we really need to see that we get initiated now in order to sort of get driven up in the next year or so. So, those would be our big challenges.
There are regulatory implications. Most of them, however, are discounted and there are one or two which are based on a misunderstanding of the industry, something like the free-look period. The rest of them are all issues which the industry is already debating and the regulator has already initiated discussions. I think regulatory issues will remain but I don't think they will be our primary concern.
Retail reach
We have a crore folios, which is the largest number in the industry. Many of our customers are small-ticket customers. But our view is far from pulling back or shrinking, we think there is an opportunity for us to add another crore very quickly. That's our aim. We are aiming to do that through the network that we have, through offering digital access, through leveraging some of the new schemes which we are proposing or we hope to launch. Over the next 12-18 months, actually we are quite committed to significantly expanding in the industry.
This article was originally published on December 14, 2015.
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