SBI Funds Management IPO subscribed 2.77 times; NII category drives demand

SBI Funds Management, the country’s largest mutual fund with assets under management of Rs 12,57,352 crore, is backed by the State Bank of India. (Fie Photo) The Rs 9,812-crore initial public offering (IPO) of SBI Funds Management Ltd witnessed healthy investor demand on the second day of bidding, with the issue being subscribed 2.77 times, led by strong participation from non-institutional investors (NIIs). According to the cumulative subscription data available at the close of day two, the NII category emerged as the strongest segment, receiving bids for 6.58 times the shares reserved for the category. The robust response reflects sustained interest from high net-worth individuals (HNIs), who typically use leverage to participate in public offerings they expect to list at a premium. Qualified institutional buyers’ (QIBs) portion was subscribed 1.50 times, indicating steady participation from domestic and foreign institutional investors. Institutional demand is often viewed as a key indicator of confidence in a company’s long-term fundamentals. The retail investor segment was subscribed 1.61 times, suggesting healthy participation from individual investors despite mixed market conditions. The steady response from retail applicants points to continued appetite for businesses linked to India’s expanding mutual fund industry and rising financial savings. The employee reservation portion received bids for 2.27 times the shares on offer, while the shareholder reservation category attracted strong interest, with subscriptions reaching 3.98 times. The IPO will close on July 16. SBI, Amundi to get over Rs 11,000 cr from IPO The firm raised Rs 2,663 crore from 129 anchor investors, including marquee global names, earlier this week. SBI and French asset manager Amundi, the joint venture partner, are expected to raise around Rs 11,700 crore from the IPO. The IPO is an offer for sale (OFS) and there is no fresh issue of shares. Hence, the company will not receive any capital from the IPO, and the offering will not result in dilution of the existing share capital. Amundi is expected to get Rs 4,400 crore from the OFS. Amundi became SBI’s foreign partner in the mutual fund in 2011 after acquiring the stake held by Societe Generale for Rs 173.9 crore following the merger of the asset management businesses of Credit Agricole and Societe Generale. SBI Funds Management, the country’s largest mutual fund with assets under management of Rs 12,57,352 crore, is backed by the State Bank of India and has built a strong presence across equity, debt and hybrid mutual fund schemes. The company has benefited from the rapid growth in systematic investment plans (SIPs), increasing retail participation in capital markets and rising household investment in mutual funds over the past few years.Story continues below this ad Market participants said the strong response from NIIs and healthy institutional participation indicate confidence in the company’s business model and growth prospects. The IPO is being closely watched as it marks one of the largest listings in India’s asset management industry and offers investors an opportunity to participate in the growth of the country’s expanding mutual fund sector. © The Indian Express Pvt Ltd George Mathew is an Associate Editor with The Indian Express, based in Mumbai. A veteran of financial journalism with nearly three decades of experience, he is one of the country’s most authoritative voices on banking, regulation, and the corporate sector. Expertise & Focus Areas Mathew’s reporting covers the nerve center of India’s economy. His specialized beats include: The Reserve Bank of India (RBI): He has tracked the central bank's policy evolution through the tenures of multiple Governors, offering deep insights into monetary policy, repo rates, and banking regulation. Banking & Insurance: Extensive coverage of public and private sector banks, non-performing assets (NPAs)