Asset Management
Vanessa Doctor Asia Editor 1 June 2010
This publication recently interviewed Sutapa Banerjee, the chief executive officer for Private Wealth at Ambit Capital, India, about prospects for the firm's business and the state of the market.
India's growing affluent demographic has caught the attention of many investors and analysts worldwide, many of whom have predicted that the country, along with China, will outdo first world nations like the US and the UK over the next years, if not already.
The recently released Wealth Report 2010 by Knight Frank and Citi Private Bank complements this expectation, highlighting the likes of New Delhi and Mumbai as thriving markets for the wealthy. The South Asian country's property sector alone, with property being a key asset among the high net worth numbers, has been estimated to hold a $66 billion market potential -- and this is just the tip of the iceberg.
WealthBriefing Asia talks to Sutapa Banerjee, the chief executive officer for Private Wealth at Ambit Capital, India, about the health of India's wealth management sector and where it is headed moving forward.
WealthBriefing Asia: Where is Ambit positioned in the wealth management industry at present and how is relating with its target market? How large is the company?
Sutapa Banerjee: Ambit Private Wealth is not just wealth management but also incorporates wealth protection and wealth transmission. While the business is a start-up, the team comprises professionals most of whom have been in the wealth industry for more than a decade. The team is well established with a good base of trusted clients.
Ambit Group has been one of the leading corporate finance players in the industry and has been always in the top 5 rankings in India. The IB/PB (investment banking/private banking) linkage is a potent combination which adds to our strength allowing us to offer superior services to our target clientele â the UHNI segment in India.
Ambit Group is well diversified group we offer mergersand aqcquisition, investment banking, institutional brokerage, research, insurance broking (life as well as non-life), funding (through our NBFC), PCG - Equity Dealing, portfolio management service, encumbrance risk management advisory, private wealth advisory.
WBA: Regulatory amendments are currently being proposed (SEBI), one of which requires a minimum net worth for asset managers to be considered able and stable. How is Ambit taking these proposed changes?
Banerjee: The wealth industry is more than a decade old in India and hence we see regulators are framing policies to ensure that it turns into a stable, effective, efficient and properly regulated industry.
Ambitâs Private Wealth [division] has adopted such policies, practices and processes in place with defined risk management and financial planning platforms which would be in line with the framework towards which the regulators are moving.
WBA: How is Ambit planning to tap the growing number of NRIs wanting to invest in the country, on top of the other nationals also wanting to get a piece of India's growing HNW demographic?
Banerjee: Ambit current team, thanks to the vintage in the wealth industry have amongst the clients they have serviced, NRIs in various jurisdictions who are willing to shift to us due to the value addition they would derive from our private wealth platform.
We are also growing business through introducers and referrers who are professionals and have been using our services, They continue to refer us potential NRI clients who are looking to invest in India.
Another important part of our NRI business growth is expected to come from our private equity investor âQInvestâ, Qatarâs largest investment bank led by Chairman HE Sheikh Jassim Bin Hamad Bin Jassim Bin Jabr Al Thani and the CEO Shahzad Shahbaz. We have a partner who is one of the most respected and reputed bankers in the region and gives us access to the clients who are not only NRIs but also Qataris looking for an advisor to help them invest in India.
WBA: What specific WM products is the company recommending and what precautions are being implemented by the firm to safeguard investments in the event of another global crisis?
Banerjee: The crux of PW proposition is based on high quality Advisory. We offer clients products and services that suit their risk, appetite and investment horizon. Our open architecture philosophy, wherein we source the âbest in classâ products and services works well for our clientele. Alongside we have in-house products â Ambit Discretionary Portfolio Management Services and our international hedge fund, that cater exclusively to our niche client segment.
From external entities we source equity and debt, third party products, PMS, structured products, alternative asset classes - real estate, gold and private equity. We also offer insurance advisory as well as tax planning and advisory.
At Ambit there is a fair amount of time spent in understanding each clients risk profile and investment horizon basis which the clientsâ asset allocation is derived. Following from this, the scheme selection under various asset classes is carried out. In every asset class we follow stringent criteria both qualitative and quantitative basis which scheme selection is done for clients.
WBA: What is the firm's forecast for the Indian wealth management market over the next 5 to 10 years?
Banerjee: The Capgemini World Wealth Report 2009 shows about 84,000 HNIs in India. With the countryâs GDP growth being quite high and expected to continue for the next 5 years it will lead to a significant, double digit growth in the HNI population year on year.
