'Motilal Oswal AMC open to partner for foreign biz'

Looks at attracting more foreign fund inflows, needs partner to gain distribution muscle in international markets

Eyeing greater foreign fund inflows, Motilal Oswal Asset Management Company (AMC) might rope in a strategic partner to gain distribution strength in international markets.

Motilal Oswal AMC, which runs Motilal Oswal Mutual Fund, is also trying to expand its exchange-traded fund (ETF) product range. The company planned to become an “expert equity house” and a preferred provider of “building blocks for asset allocation” through the next five years, said chief executive Aashish P Somaiyaa.

“We are open to consider a strategic partner, if it can help us with distribution access internationally and allow us to carry our Indian equity manufacturing prowess to foreign shores,” he said.

He added the company’s products were well positioned for the domestic market.

Motilal Oswal Mutual Fund manages about Rs 538 crore of investor assets across five funds. To attract foreign investors, it plans to leverage the brand value of its parent firm Motilal Oswal, which is present across various segments of the financial services sector. “As a group, Motilal Oswal has excellent recognition in certain international markets such as the US, the UK, West Asia and other Asian countries…Currently, we get inflows from foreign investors registered as FIIs (foreign institutional investors) in our equity strategies and ETFs. With the proposed launch of our maiden open-ended equity offering, we will work towards getting foreign money from other routes, too,” Somaiyaa said.

Somaiyaa said in India, distribution was likely to become more regulated and organised. The business would become “platformised” among the banking, broker-dealer and organised independent financial advisor platforms, he added.

On potential acquisition targets, Somaiyaa said, “One keeps options open in managing a business. But any partnership, acquisition or merger has to come with augmenting of competencies that are far more value accretive than just assets under management.”