Union AMC aims to double AUM to Rs 10,000 crore
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New Delhi: Union Asset Management Company (AMC) on Thursday said it is looking beyond top 30 cities to double its asset base to Rs 10,000 crore within a year. Union AMC's plan also comes against the backdrop of the amalgamation of Andhra Bank and Corporation Bank with Union Bank of India, which is the co-sponsor of the fund house along with Japan's Dai-ichi Life Holdings.
The amalgamated entity now has more arsenals in terms of branches, manpower and number of customers, among others, Union AMC said in a statement.
In addition, the fund house is looking to drive the business through mutual fund distributors rather than depending only on the bank branches to sell the financial product. Also, the fund house has hired a 40-member team to push growth.
"Armed with a committed and resourceful set of sponsors, a new CIO at the helm and a robust investment process that aims to deliver consistent returns, combined with an aggressive sales and marketing strategy we aim to double our AUM from current levels in a year's time," Union AMC CEO G Pradeepkumar said.
The fund house said it is eyeing beyond top-30 cities or B30 cities in order to achieve its AUM target. Currently, Union AMC's AUM from beyond top-30 is at 39 per cent against 16 per cent of industry average. The mutual fund industry has 45 players, which together manage assets to the tune of Rs 29.71 lakh crore. Union AMC is bullish on sectors such as IT and telecom and are underweight on utility and consumer discretionary sectors.
"Markets are expensive at this juncture, but are not in a bubble territory as yet. In the current market situation, we recommend asset allocation based mutual fund products," Vinay Paharia, Chief Investment Officer of Union AMC, said.
As for fixed income, he said that softer interest rate regime could continue in the near term till economic growth completely revives. "The key risk to both - equity and fixed income markets - would be any unanticipated spike in inflation leading to increase in interest rates," he noted.
