ICICI Prudential AMC, one of the largest mutual fund houses, mobilized Rs 3,021.8 crore from 149 anchor investors at Rs 2,165 per share ahead of its initial public offering (IPO) that opens for bids on December 12. The Rs 10,600 crore IPO, the largest of a wave in December, is assisted by 18 investment banks.
Global and Domestic Institutional Faith in the AMC
While around a third was allocated to 27 domestic mutual funds through 77 schemes, state insurer LIC and Capital Group Global were the top investors with chunks larger than 5.6% each. The single largest buyer was the Singapore Government. Various sovereign funds bought net 14% of the overall anchor book. Other major buyers include seven schemes of HDFC Mutual Fund and two schemes of SBI Mutual Fund. Magnum Hybrid Long Short Fund also purchased in small quantity.
The IPO is shaping up to be a landmark event for the Indian capital markets, similar to that of brokerage Groww’s IPO in November. The pre-IPO and anchor book allocations are a testament to institutional investors’ faith in the ICICI Bank sponsored AMC, said market experts. Diverse investors from global sovereign wealth funds to India’s top family offices, veteran investors, every major domestic life insurer, and more than half the mutual fund industry players have placed their bullish bets ahead of public bids.
With over three decades of experience, ICICI Prudential AMC is the country’s largest active mutual fund manager. The high-profile debut on the stock market comes at a time when the markets regulator is in consultation with the industry on changes in MF fee structures. The IPO is entirely an offer for sale by Prudential Corporation Holdings, one of the two promoters.
Sovereign Wealth Funds (SWFs) such as GIC (Government of Singapore Investment Corporation), Temasek and Lunate Capital (Abu Dhabi Investment Authority), joined long-term global endowment fund such as University of California. Large Foreign Portfolio Investors (FIIs) showed interest, with names like Fidelity, Norges Bank, BlackRock, Aberdeen, Wellington, Capital World, J.P. Morgan Investment Management Inc, Fidelity Management & Research, Goldman Sachs Asset Management, WhiteOak and HSBC GAM.
AMC’s Strong Financials and Diverse Product Offerings
ICICI Prudential AMC also provides Portfolio Management Services (PMS), Alternative Investment Funds (AIF), and advisory services for offshore. It ranks among the most profitable AMCs in the industry. The IPO is priced at 40.x PE on FY25 earnings in line with industry valuations. The company’s profit increased from ₹2,049 crore in FY24 to ₹2,650 crore in FY25.
Earlier the pre-IPO round saw strong institutional interest from Private Equity (PE) like Kedaara Capital, Chrys Capital and Family Offices, including Premji Invest, HCL Family Office and Estate of late Mr. Rakesh Jhunjhunwala.