Morningstar enters PMS segment, eyes Rs 1,000cr AUM in 2-3 yrs

Financial information company Morningstar Tuesday said it is targeting to build an asset base of Rs 1,000 crore for its newly-launched portfolio management service (PMS) arm over the next three years.

India is the fifth country where it has launched the PMS business after some developed markets.

"Over the next two to three years, we are targeting to have an asset under management of Rs 1,000 crore," its director Dhaval Kapadia told reporters.

Kapadia said the company has taken a PMS licence from capital markets regulator Sebi, and will be selling its services through financial advisors.

The minimum ticket size will be Rs 25 lakh, he said, adding the funds will be deployed in mutual funds focused on a variety of asset classes such as domestic fixed income and equities, foreign equities and also gold.

It has launched a set of four PMS portfolios which investors can choose from based on their risk appetite and investment horizons.

Kapadia said the service would typically ask for an investment horizon of over five years, but said there is an exit load of 1 percent in the first year RPT in the first year to avoid abrupt churns.

An individual investor on whose behalf the portfolio is being managed will hold the MF units in which investments are being made and all the relevant tax treatments will have to be complied with accordingly, he said.

Once the individual gives the mandate to the company, she will not be able to take any investment decisions till the exit formalities get completed, he said, adding the service will come at a fee for investors to make it competitive.

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