IndiaNivesh has decided to shut down its portfolio management services (PMS) business. In a communication to its clients, the firm has said “In view of the current market volatility pursuant to the global outbreak of Covid19 and its long-term impact on our business, we have decided to close our operation at IndiaNivesh Investment Managers Pvt Ltd, a Sebi-registered portfolio manager. Thus, our sole strategy of Sprout Portfolio will be wound up.”
IndiaNivesh has decided to handover all the assets under the custody (AUC) to the clients. The investment manager has asked its clients to choose between “Liquidation of all the shares held in the strategy and transfer the proceed along with cash balance to your bank account;” or “Transfer shares to your Demat account ( other than the one opened for PMS with IL&FS) and cash/liquid funds to client’s bank account.”
IndiaNivesh has said given the lockdown the process of winding up could de delayed.
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The total number of clients or AUC of IndiaNivesh Investment Managers couldn’t be immediately ascertained.
Sources said the money manager had high exposure to stocks, including those belonging to the Future group, which seen a meltdown in recent market corrections.
Queries sent to Sandeep Jain, managing director, IndiaNivesh Investment Manager remained unanswered.
The fall in the market couldn’t have come at a worse time for the PMS industry, which has been grappling with a complete overhaul of regulations enacted by market regulator Sebi. Some of the key changes include capping of fees, doubling of minimum investment amount to Rs 50 lakh and increase in net worth to Rs 5 crore from Rs 2 crore.
Typically, PMS service providers have a bias toward the Midcap and SmallCap universe to generate higher returns. This space has been particularly hit in the latest market fall, with the one of the SmallCap gauges even dropping to a 12-year low last week.
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