Jackpot for SBI! Lender to pocket ₹7,364-cr from SBI Funds Management IPO

State Bank of India (SBI) is set to unlock around ₹7,364 crore through the proposed initial public offering (IPO) of SBI Funds Management as the country's largest public sector lender pares its stake in the asset management company through an offer for sale (OFS).

 

According to the Red Herring Prospectus (RHP), the ₹11,692.91-crore public issue, which opens for subscription on July 14, 2026, comprises entirely an OFS of 203.7 million equity shares. Under the issue, promoter SBI will divest up to 128.33 million equity shares, while co-promoter Amundi India Holding will offload up to 75.37 million equity shares.

 

As of the date of the RHP, SBI held 1.26 billion equity shares of face value ₹1 each, representing a 61.86 per cent stake in SBI Funds Management. Amundi India Holding held 740 million equity shares of face value ₹1 each, accounting for a 36.33 per cent stake in the company. 

The IPO has been priced in the range of ₹545 to ₹574 per share. At the upper end of the price band, and assuming the issue is fully subscribed, SBI is expected to realise ₹73,66,39,43,878 from the sale of its shares through the OFS.

 

 

SBI's average acquisition cost for its investment in SBI Funds Management stands at ₹0.15 per share, translating into a total acquisition cost of approximately ₹1,92,50,159.55.

 

After adjusting the total acquisition cost from the expected proceeds of the stake sale, the transaction is likely to generate a pre-tax gain of ₹73,64,46,93,718.45 for SBI. The final gain, however, will be subject to applicable taxes and IPO-related expenses.

 

Following the OFS, both SBI and Amundi India Holding will continue to remain shareholders in SBI Funds Management, although their respective holdings will decline in line with the shares sold under the public issue.

SBI Funds Management IPO details

The initial public offering (IPO) of SBI Funds Management will open for subscription on July 14, 2026, and close on July 16, 2026. The company has fixed a lot size of 26 shares, requiring investors to bid for a minimum of one lot and thereafter in multiples of 26 shares.

 

At the upper end of the price band of ₹574 per share, a retail investor will have to invest ₹14,924 for one lot. Retail investors can bid for up to 13 lots, or 338 shares, taking the maximum investment to ₹1,94,012.

 

The shares of SBI Funds Management are expected to list on the stock exchanges on July 21, 2026, subject to the completion of the issue process.

 

Since the IPO is entirely an offer for sale, SBI Funds Management will not receive any proceeds from the issue. "Each Promoter Selling Shareholder shall be entitled to its respective portion of the proceeds of the Offer for Sale, after deducting its respective portion of the Offer-related expenses and the relevant taxes thereon, in accordance with the terms of the Offer Agreement," the company said in its Red Herring Prospectus (RHP).

 

Kotak Mahindra Capital Company, Axis Capital, BofA Securities India, HSBC Securities and Capital Markets (India), ICICI Securities, Jefferies India, JM Financial, Motilal Oswal Investment Advisors, and SBI Capital Markets are the book-running lead managers to the issue, while KFin Technologies is the registrar.

About SBI Funds Management

According to the RHP, SBI Funds Management is India's largest asset management company (AMC) by quarterly average mutual fund assets under management (QAAUM). The company had a QAAUM of ₹12,50,998 crore and a mutual fund market share of 15.3 per cent as of March 31, 2026, a position it has consistently maintained since March 2021.

 

Including its Portfolio Management Services (PMS) and other advisory mandates, collectively referred to as Alternates, SBI Funds Management's total QAAUM stood at ₹29,46,105 crore as of March 31, 2026.

 

SBI Funds Management is also India's oldest AMC, serving as the investment manager to SBI Mutual Fund, which commenced operations in June 1987 as the first mutual fund entity outside Unit Trust of India, according to the CRISIL report cited in the RHP.