Mid-sized investment bank Equirus Capital plans to launch its portfolio management scheme (PMS) business by the end of this month with an initial corpus of around Rs 80 crore, according to a top company official.
“We have all the licences in place, including those from market watchdog Sebi. The only permission pending is from CDSL, which we expect to come in any time now. We hope to formally launch the PMS business this month itself with a corpus of Rs 60-80 crore,” Ajay Garg, founder and MD of the mid-market focussed Equirus Capital, told PTI.
He said the PMS plan is part of the broader strategy of expanding the current bouquet of offerings and cashing in on the rising investor appetite for equities.
Last month, the city-based Equirus had appointed Viraj Mehta as the fund manager for the division. Mehta was earlier with Franklin Templeton and ValueQuest.
Recently, it effected some changes to its top management, appointing Ajit Deshmukh the head of its investment banking arm so that founder Garg can focus more on the new PMS business, wealth management, structured debt for HNIs and institutional equities.
Asked about the source of the committed funds, Garg said it will primarily be pooled in by Equirus promoters as well as some of its existing clients and their friends.
While Garg owns around 65 per cent in the company, the rest is held by leading investor and market bull Rakesh Jhunjhunwala and some private equity players.
On the rationale of entering the PMS business, Garg, who founded Equirus in July 2007, said this allows him to expand the scale of business, stabilise income streams and provide an exit to current investors a few years down the line.
“Over the past five years, we have been able to build a track record of identifying mid-market winners with bottom-up research and PMS is an extension of this so that we can offer more value to our customers,” he said.
On investment streams for the PMS business, which is worth around Rs 25-30,000 crore and is dominated by Motilal Oswal and Ask Advisory, he said it will be primarily equities tapping only the existing clients.
“As we grow, our brand will look at tapping NRIs and other HNIs,” he added.
He further said PMS will have a bottom-up approach for research and will leverage the company’s long track record of value creation.
Founded in 2007, the city-based company is a full-service investment bank and has completed over 100 transactions across capital raising, M&As and repeat business with marque clients offering advisory services to private equity, M&As, capital markets investments and structured finance services to mid-cap clients.