Samir Arora-backed Helios Capital gets in-principle approval for mutual funds

Samir Arora’s Helios Capital, which has been running portfolio management services (PMS), has received an in-principle approval for mutual funds from the Securities and Exchange Board of India (SEBI).

Arora confirmed the development in a social media post on September 4.

Nearly 19 years after he quit Alliance Capital Mutual Fund, Arora is looking to re-enter the Rs 37 trillion Indian mutual fund industry.

Helios had applied for an MF licence on 25 February 2021. In India, Helios is registered with SEBI to offer PMS and runs offshore long-short and long-only India-focused funds out of Singapore.

Recently, Zerodha Broking, Bajaj Finserv and Frontline Capital Services have received in-principle approvals from SEBI for mutual fund forays.

The mutual fund industry has been drawing interest from several entities, financial services firms, brokerages, as well as PMS firms.

Among PMS firms, Alchemy Capital, Old Bridge Capital Management and Unifi Capital are waiting for mutual fund approvals.

Angel Broking and Abira Securities are other entities that have applied for mutual fund licences.

Sachin Bansal-backed Navi MF got SEBI approval last year to run its mutual fund business.

Flipkart-owned PhonePe has also applied for mutual fund licence.

Why so much interest in mutual fund business?

The low penetration of mutual funds in India is the major reason financial firms want to venture into this industry.

A Jefferies report stated that assets under management held by the mutual fund industry are just 12 percent of India’s GDP, whereas the global average is 63 percent. Other developing nations such as Brazil (68 percent of GDP) and South Africa (48 percent of GDP) have much higher proportions of mutual fund investors.