UTI Asset Management Company (UTI AMC) together with its international arm UTI International are looking to commence their US operations this year, Vetri Subramaniam, Chief Investment Officer of this leading asset manager has said.
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Last month, the US Securities and Exchange Commission (SEC) — securities market regulator of the US —gave its nod for UTI AMC to enter the US market and set up their own unit (subsidiary), Subramaniam told businessline.
The US operations would be in the form of a sales office, which will be run by UTI International while the monies would be managed by UTI AMC.
Significant step
This entry into US market is significant as so far very few Indian fund managers have gone there and had got an approval from US SEC to offer their services in that market. Largely, the US market and flows from the US market into India have been dominated by the US fund managers. “Ours will be primarily a sales and marketing operation, but approved by the SEC to market locally (in the US) for funds that will be managed by UTI AMC in India.
So our first priority might actually be to win institutional mandates in that market rather than necessarily go after launch of a India-dedicated fund because it’s easier to present your credentials in the institutional market than to launch a fund and then market it to the US public, who may not know who UTI is”, Subramaniam said.
At the same time, he highlighted that UTI has over the years built a decent track record of managing over $3 billion for global investors in its international operations. “We intend to build up on this in the coming days. Now that we have got the approval for US, we are putting together a team there. Eventually UTI will also have a strategy in place to cater directly to retail investors there”, Subramaniam added.
“From our point of view, there is no reason why all the money that US investors wish to put in India should only be managed by US managers. We think we have a right to win in that business and therefore we have decided to enter that market”.
Subramaniam also highlighted that UTI all these years never had a physical presence in the US (like this time in the form of a subsidiary).
Global presence
Currently, UTI has registrations in 35 countries and arealready present in most of Europe, South Asia, Southeast Asia, Japan, Middle East, even South America. “So the only market we were not present in was Continental North America. So that’s the market we are now entering”, Subramaniam said.
Simultaneously, UTI had also last month received approval from Paris to have our own sales office there for UTI International.
Subramaniam also said that UTI for its alternative business is exploring the setting up of a unit in Gift City, Gujarat.
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On domestic expansion, Subramaniam said that last year UTI AMC opened as many as 29 new branches, taking the overall branch network to 200. “We will continue growing the number of domestic branches over the next two years because there’s a clear opportunity to do that. We will adopt a phygital strategy for customer acquisition”, he said.