Union KBC, a joint venture asset management company formed by Union Bank of India and KBC of Belgium, is planning to increase the total asset size to Rs 5,000 crore by next year from the current Rs 1,000 crore by widening product portfolio among other initiatives.
The company has so far come up with four product offerings after it received mutual fund licence from the Securities and Exchange Board of India (Sebi) in March last year. It is now planning to launch three more products -- an asset allocation fund with a mix of equity, debt and gold investments, a small and mid-cap fund and an ultra-short term debt fund -- this year.
Speaking to reporters at the launch of the upcoming Union KBC Dynamic Bond Fund here on Thursday, G Pradeepkumar, CEO of Union KBC, said the company was striving to achieve stability and scale to capture the business opportunities.
It had witnessed volatility last quarter when the size of the total assets under its management came down to Rs 540 crore from Rs 869 crore in the previous quarter due to flight of corporate investments from the liquid funds.
To bring more stability and stickiness, the company has to focus on expanding the retail component of these funds on the one side and ensure the fund size under a product reaches Rs 1,000 crore on the other, according to him.
The company is aiming to enroll 100,000 systematic investment plans (SIPs) by 2013 from the present 8,000 to increase retail component of the funds. It is also actively trying to tap the 30-million strong customer base of Union Bank to increase retail participation in its mutual fund products. Among the new product offerings the asset allocation fund, which has received Sebi approval, is expected to be launched in a few months from now.
The company said timing of the launch of the Dynamic Bond Fund, which opens on January 23, was right as it coincided with the possible downward trend in interest rates.The company aims to mobilise Rs 100 crore for the product by March this year.
