And congratulations to all three winners. I would say SBI, SBI Funds, and of course Amundi. One question to each of you, sir. As far as the bank itself is concerned, I want to ask: of course we've had the listing of SBI Funds Management today. There are just two subsidiaries now which remain unlisted, large ones: the general one and the pensions. Which one is next and would it be this financial year or next financial year? The next one is for SBI Funds. I want to understand as far as certain things: first, the impact of TER specifically on the margins, the recent changes which were made, and the road ahead for TER. Do you see further tightening in any form? Second thing: mutual fund being allowed as collateral for MTF. How do you see that working for the industry? And finally, as far as Amundi is concerned, we've seen this trend that once AMCs get listed on exchanges, the foreign partner there tends to sort of value unlock after listing. We've seen that in HDFC, we've seen that in ICICI potentially. What is Amundi's stance here? Two years, three years down the line, would we have you holding the same amount of conviction in terms of your holding in the company going ahead? Thank you so much.
So let me start by thanking all the stakeholders for the wonderful response we have got for the IPO of SBI Funds Management Limited. I probably would not be able to answer his question to me for two reasons. One is we are in a silent period; it will be seen as a forward-looking statement. But more importantly, I think it is SBI Funds' moment. Let us enjoy that. Having said that, there are definitely financial institutions. State Bank of India has helped to grow through our subsidiaries route, and now currently with SBI Funds Management, we have three subsidiaries listed, and we would definitely look for opportunities of listing as they evolve and mature and reach a stage where listing makes sense. Thank you very much.
Mr. On the fund side, I have two questions.
So, thank you media and thank you for your support today. As mentioned, we are also in a silent period, so difficult with any statement. But what is done before the TER is now B? Yes. So we have already accounted for it, and it is now revenue neutral on that. We already mentioned road source, so our accounting system has already taken care of that. Going ahead, you said collaterals; it is an industry-related scenario which will request MP and others to look at it very carefully. Okay.
Third final question, you want to take maybe on SBI SBM?
It is a very strong partnership between SBI and Amundi. It has been a long journey for us, this partnership that has lasted for 20 years. But I want to say it is only the beginning, and we are a very happy shareholder of SBI FM. We will continue to build this partnership to grow together, and we will continue to be there alongside SBI for a very long time. Thank you so much and congratulations again.
Anurag Joshi, ET Now. Congratulations, sir. My question to you is that it's been a 15-year partnership with Amundi. You have successfully completed an IPO now. Going forward, how is SBI planning to take the partnership with Amundi forward? And to Mr. Nikolai, my question to you is: is Amundi looking at boosting your investments to India? What is your outlook on India currently? And in terms of the risk ometer, how do you see India in terms of risk?
I'll go first. It is a long-term relationship, as Nikolai said. I think this divestment — a lot of people asked us why this listing now. SBI FM doesn't require capital; it is a capital-light industry. Similarly, SBI and Amundi did not look for any capital raising. But I think we both believe that such a large AMC not being listed is not systemically good, and we wanted to bring a large AMC to the market. So having said that, this listing does not change anything in our relationship and partnership. Very interestingly, Amundi, in several roadshows, has publicly mentioned that while Amundi's best international practices used to be brought to India, now SBI FM's best practices and India's best practices of mutual fund are taken internationally. I think this relationship would continue for a long time. Nikolai, I go over to you.
I can only confirm what the chairman says. We will continue to develop together to make sure that SBI FM is developing in India, and we will continue to bring what we try to bring. Of course, our international expertise in asset management, but more and more indeed to translate and transmit to SBI FM the growing interest we see from international investors for Indian assets. India is a very rapidly expanding economy; there is more and more interest from international investors, and we will continue to bring these interests into the expertise of SBI FM.
Hi, thank you, sir. I have two questions. First, Mr. Setty. Mr. Setty, of course, SBI's parentage was very important to the listing here and pushing this forward. How strong — how did SBI approach this listing in that sense? How did that brand name sort of build out the reputation and the premium that this listing has brought through? If you could take us through that a little bit. Similar question for you with Amundi's role here. What sort of role did you play in getting this IPO forward and building this out in the way it did?
So coming to SBI, I think it is not only the largest distributor of mutual fund products. As I mentioned in my speech also, we wanted to bring this investment opportunity to a large number of retail customers that we have. So probably the value creation is not only in terms of what SBI FM has been delivering on their schemes; it is also a fact that they have the backing of the largest parent company. And what we would like to assure all the stakeholders is that even before listing, this company was having the best governance practices of both SBI and Amundi. I think that is a value which we have created over a period of time for all the subsidiaries we have. We almost have 18 subsidiaries, and the value creation you mentioned — I take pride in mentioning that our investment in these subsidiaries is about 6,000 crores as we speak today. Hopefully maybe a month later the number will change; we are valued at 4 lakh crores. I think that is value creation for all the stakeholders we have done, and in the process we also have created institutions of enduring value in the financial services. You would like to take the rest of the question.
Of course, Olivia.
As for Amundi, we try to bring a little bit of our experience. As you know, we are a listed company. We lived through this process a bit more than 10 years ago, being listed in Paris. So we had this experience and we tried to share it and to advise SBI in the process. And I think a second dimension we brought is probably during the roadshow, the contact with international investors. Of course, SBI and SBI FM have a lot of contact with international investors, but we could also help in that regard, and Olivier has been participating in roadshows alongside Chairman Setty in that regard.
Good morning, sir. So congratulations.
You can ask a question in English. Yeah.
So my question is that in the next three to five years, if we talk about the AUM, where do you see the growth coming from? And since this was an entire OFS, for a shareholder, where do you see the value creation here because there was no fresh money raised; it was entirely OFS?
We are the participants. You have to respond, see. We came with confidence. Whatever the market is, we cannot time the market like an investor. The company also wanted all the trust and confidence of investors to come back to the market. That is why today, already it has gained 6% — when I saw the screen, 8%. So valuation in the long term will be very high because, as I mentioned before, out of 140 crore Indians, we now have only 10 crore mutual fund portfolio folios. So we have a long way to go. In the country, valuation will also be more. We are also looking at international schemes with Amundi support, where they are also present and making this proposition. So in the long term, there will be much valuation.
Maybe just I would like to add one point from our perspective. There is one figure I like very much: when you look at the size of AUM of an individual firm divided by GDP, in India it is 18.8%. In France it is more than 80%, and in the US it is 120%. So you see the potential.
So will we see in the near future you increasing your stake?
What you can see is that you will see us increasing our partnership, the way we work with SBI. We are very, as Nikolai said, we are very committed to India, very committed to the sales market in India, and of course we are very committed to this partnership.
Thank you, sir. Thank you, Aasta, from Business. And then we come to this side.
Many, many congratulations, please. I want to ask one very simple thing. SBI of course continues to hold a majority stake in SBI Funds. Do you see further value unlocking through stake dilution in the future, or will the bank retain the current holding? This is my first question. And the second question is about the fund: do you see passive funds and ETFs becoming a bigger part of the business? Now.
The first question I will answer, and the second question probably the company will answer. At this moment, we are not looking for any more dilution. Of course, the whole dilution process will depend on the public shareholding norms of SEBI. This is true for Amundi also. I can tell you that.
So I think we don't intend to look for any further dilution at this moment. So, like active funds management is our bread and butter. So there we are very much into innovation, product solutions. Also passive and ETFs and AIFs will be our future streams of business. We are consolidating there; we are already the largest passive portfolio, around 4 trillion in the country, and we have a team looking at the whole passive fund innovations, new product solutions. We always have on our radar to increase the portfolios.
Thank you so much. Thank you.
Thank you. We'll give some chance to the print and online media from Business.
Hi, sir. So we saw you put out numbers yesterday. How much have you drawn so far? How much is your target, and overall industry, how much do you think they can?
Let's meet Panda on the 7th of August. I'll give you the number. Let's speak to the future.
Question from Financial Express.
I wanted to ask you that there was a lot of conversation around the fact that SBI Funds' valuation around its IPO was very much fair and very much in line with the industry actually. So given that, are you happy with the listing gains? Because there was a lot of conversation that a lot of gains are still on the table. So given that, are you happy with 7%?
So when 63 lakh investors participate in an IPO, we look for everyone to have something on the table. What you see now is the beginning. I think in the future, I already answered to your colleague that it will be much more. Valuation is a scientific process. We looked around the world, all investors, our partners, Amundi, and many stakeholders took part in this pricing. It is totally scientific and driven by rules and regulations. So we came out with a number which is adaptable for this kind of IPO coming up.
From Moneycontrol.
Hi, so you had mentioned that you've seen from a listing that there is so much more that happens post listing. So I wanted to understand two parts of it. I wanted to understand what's next for Amundi in terms of priority, what's next in partnership. And also from SBI Funds, I want to understand now that we have the IPO, which has been a priority for quite some time, what's the next core focus for you in the coming months or maybe coming years?
So your first question was what's next for us regarding SBI FM in the partnership. Basically, it's continue the journey, continue the growth. There are tremendous opportunities with the broadening of more and more investment from retail investors in particular in India in asset management products, coming from the development of retirement solutions, coming from the development of passive management solutions, and we will be there. And coming also from increased interest from international investors, and we will continue to support the management of SBI FM in any way we can in that journey.
So I have my head of subsidiaries, Mr. Nash, here. He always tells us that wherever you are, be number one. SBI Life Insurance is number one in private life insurance, SBI Card is number one in cards, and SBI Mutual Fund is number one in asset management. So our aim will be, as you mentioned and as the chairman already mentioned, to be the fund manager to every Indian, like SBI banker to every Indian. I would like to be the fund manager to every Indian by doing four things. Number one, democratizing the investment: as I mentioned, 140 crore population of India and only 10 crore are in investment portfolio, so we have a lot of way to go to the towns and cities to bring another 100 million in 5 years' time to this whole investment world. The second will be digital delivery. When you try to serve the large mass of population, we need to have digital solutions which are already there. We have an Invest app which is AI-driven, and we will continue with more digital database solutions. Third is value to investors, because we know investors depend on us for their living and their savings, so we also add value to all investors. And fourth, as already mentioned, we will go to new areas like passive funds, ETFs, and international markets to add value to our company. Thank you.
