The Trust group is the largest debt syndicators in the non-banking sector in India. However, Trust AMC is listed as the fifth largest if it includes bank-based AMCs.
It has the highest NFO collection of all time in the ‘Banking and PSU Debt Fund’ category at Rs 580 crore. “We are the only non-bank in the top five. We are the only non-bankers in the big boys’ club,” stated Sandeep Bagla, CEO of Trust AMC. “In the last three-four years, I have only seen ICICI, HDFC, AXIS, and SBI in that list.” The company is the largest underwriter/ syndicator and, for the last 10 years, it is among the top five in corporate bonds, as per reports.
Trust AMC is run by the Trust Group which was started by Utpal and Nipa Sheth. “While Utpal Sheth has a mentorship role in all the business, Nipa Sheth runs the day-to-day operations.” The group has been advising or managing Rs 25,000 to Rs 30,000 crore worth of assets across equity and debt. “The problem with Portfolio Management Services (PMS) is the ticket size for investment is very high. But if you want to take it to more people, then a mutual fund is an option.”
The group recently ventured into mutual funds, a natural extension to its existing financial services. “We have started with fixed income offerings,” stated Bagla.
The AUM of the Indian MF industry has grown from Rs 7.85 lakh crore as of April 30, 2011, to Rs 32.38 lakh crore as of April 30, 2021 — more than a four-fold increase in a span of 10 years, according to AMFI. Commenting on the growth, Bagla stated, “The penetration of mutual funds among Indian investors has been lower compared to evolved markets like America, even the Asian peers. That means India can only grow.”
With more and more liquidity in the system during the COVID times, Bagla stressed all those monies will find their way to banks, corporates and mutual funds.
The market has done well during COVID-19 times — be it equity or fixed income. But he asserted that the euphoria in the markets is counter intuitive. “Liquidity overshadows all rationality,” he explained.
The present approach towards liquidity by central bankers is a cause of concern. “Due to excess money printing, the cycles are becoming shorter,” he says. This is true for interest rates, equities, commodities — it is scary.
Bagla cautioned it is difficult to differentiate the effect of liquidity and other effects. But sooner or later, the regulators will have to find a way to let go of the effects of liquidity.
This excess liquidity in the system has allowed assets like gold, cryptocurrency etc to grow. Even though gold prices are unpredictable, with more money printing, more and more people will start to lose faith in fiat money, explained Bagla.
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