SBI Mutual Fund plans to double its assets under management to ₹26 trillion over the next five years. The strategy includes expanding its reach into smaller cities, growing its investor base to 3.5 crore, and diversifying into alternative and international investment products.
SBI Mutual Fund has outlined an ambitious growth roadmap, aiming to double its assets under management (AUM) to over ₹26 trillion within the next five years. This strategy follows the fund house’s recent successful Initial Public Offering (IPO) and focuses on four main pillars: digital service delivery, wealth creation, investment performance, and new growth engines.
Targeting Growth Beyond Metros
A central part of the fund house's expansion involves increasing its presence in Tier 2 and Tier 3 cities. Currently, about 30% of its assets come from areas outside the top 30 cities (B30). The company aims to lift this share to 50% within three years. Management expects the next wave of investment growth to emerge from these smaller towns and rural regions, rather than just large cities. To support this, the fund house intends to expand its total investor base from 16 million to 35 million in five years, using digital channels to reach new investors.
Diversification and Strategic Partnerships
Beyond traditional mutual fund schemes, the company is looking to enter new product categories including passive funds, alternative investment funds, and international investment offerings. The fund house’s subsidiary in GIFT City is expected to play a major role in providing international investment access. The long-standing partnership with the French asset manager Amundi, which has been in place for 24 years, continues to be a key element of this strategy. Following the recent IPO, State Bank of India retains a 56% stake, while Amundi holds a 32% stake. This partnership is expected to provide technical support in areas such as technology, international fund management, and alternative investments.
Distribution Strength and Market Position
The fund house continues to leverage the massive distribution network of its parent company, State Bank of India, which operates over 23,000 branches and 75,000 customer service points. While this network is a primary driver of its business, the fund house also plans to increase its collaboration with other public and private sector banks. It aims to double the business contribution from these external bank partnerships from the current level of under 5% to approximately 10% over the next three years.
For investors, the key monitorable will be the fund house's ability to maintain investment performance while managing the challenges of scaling operations into smaller cities. Success will depend on the effectiveness of its digital tools in converting interest from new investors into actual assets and the ability to execute its product diversification plan in a competitive mutual fund market. Investors may track future updates on the contribution of new product categories and the growth of assets sourced from outside the top 30 cities.