As of September 2017, the AMC has assets of Rs 1.5 lakh crore, according to the Association of Mutual Funds in India (Amfi) data. At six per cent of its assets, the fund house could command a valuation of Rs 9,000 crore. This means the total stake sale of 33.2 per cent from the four sponsors could collectively fetch about Rs 3,000 crore. An email sent to UTI AMC regarding the possibility of an IPO remained unanswered.
UTI’s legacy and brand recognition, together with a robust distribution network and access to public sector money, could work in its favour, and help it command a premium, said experts. The AMC has been consistently profitable and reported a net profit of Rs 291 crore for FY17.
In November 2009, T Rowe Price had agreed to buy a stake in UTI AMC for about $140 million, or about Rs 650 crore, valuing the fund house at about Rs 2,500 crore, or 3.2 per cent of its average assets under management.
UTI was the number one asset manager in terms of assets it managed till FY06. It then slipped to No. 3 at the end of FY07, No. 4 in FY09 and to No. 5 at the end of FY12. It is currently at No. 6.
According to news
reports, LIC had turned down the proposal for an IPO for UTI earlier this year, even as the other three PSU shareholders — SBI, BoB and PNB — agreed to the listing in early February.
The AMC had wanted to go public way back in 2008 but put its IPO plans on the backburner owing to volatile market conditions.
UTI MF had struggled to appoint a new chief after erstwhile chief U K Sinha left the firm in February 2011. It finally appointed Leo Puri as managing director in August 2013.