This Asset Management Platform Will Help You Beat Inflation

In a conversation with Entrepreneur India, Gupta spoke about why she thinks the Indian mutual fund industry is in its infancy with tremendous growth opportunities ahead and how she wishes the cyclicality nature of investing in the stock markets goes away for good

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Access to financial markets is rapidly expanding in India, and many first-time investors are choosing mutual funds as a safe and convenient way to put their money to work in the market.

Edelweiss Asset Management Limited
Radhika Gupta, MD & CEO

The Association of Mutual Funds in India (AMFI) reports assets under management in Indian mutual funds grew fourfold to INR 25.49 trillion over the last decade.

In the Indian context, we are in a very young and exciting phase and it is almost compared to teenage years. 

If you look at the numbers, they tell you that mutual fund penetration as a percentage of GDP is probably between 4-6 per cent and the world average is 40 per cent.

The industry is in its infancy and ripe for disruption probably in a way that it wasn’t as much ten years ago, because suddenly you know you can be a new player and find a niche for yourself and reach the consumer without having 200 branches all over India because, ultimately, each phone that you have in hand is a branch that you have. 

With things like social media, even the importance of marketing budgets has gone down. So, it’s an industry ripe for disruption. There is a tremendous opportunity for benchmarking globally, and there’s a tremendous opportunity to benchmark Edelweiss Asset Management Limited (EAML) to India. And it’s also a time when people are embracing new concepts, so, all in all, very exciting space to be in and there’s a reason EAML managing director and chief executive officer Radhika Gupta chose to join this industry for five years ago.

Gupta, in an interaction with Entrepreneur India, reminisces her learnings as the chief executive officer and said, “I think the first one in the asset management businesses is that you manage money for people. You represent the brands, represented honestly and responsibly manage money like it's your own. A deep focus on execution. It's a simple business, keeping it simple and just going out and working hard as a ‘chappal ghisso’ every day is extremely important. And thirdly, not just building a good team but trusting that team and building a very honest open relationship with that team that can last through good and bad, trusting your team.”

She believes that her management style is simple and effective as she has never been a fan of the corner office model and is very much an on-the-floor person. She also believes that they all play roles in an organization but ultimately chief executive officers, and senior management to all of this, they need to be approachable first.

According to her, the most daring step taken in her current position is definitely introducing debt passives.

Gupta is experimenting with some new ways of doing business in the new normal as she thinks that doing the hybrid work-from-home model has been appreciated. The platform has also taken on a lot more digital in terms of business, and digital is not just transaction, so their entire engagement is events model, for instance, move digital with the series called Konnect.

The establishment started the mutual fund back in 2017 business was about INR 6,000 crore. Today, they are anINR 6,6000crore mutual fund business. So tenfold growth probably be in the fastest growing in the industry.

“You know new things keep happening so complacency can’t set in and I think that's something me and my team talk about. You know, bull markets with lots of stuff is happening. I think curtailing temptation to just follow along your path is extremely important to not get distracted. I think that's extremely important,” she stated while sharing the biggest challenge she is tackling in her current position.

The company will focus on Building Product lines and strengthening them. Hybrid funds have been very core to the company and continue to build a flagship balanced advantage fund and fixed-income passive. They have just strengthened the long-only equity franchise and will continue to build out. Interesting solutions for customers there. Their net goal is that whatever they do, they should build financial products, that provide enduring and meaningful solutions for people.