MUMBAI: The portfolio management services (PMS) industry has the potential to grow at over 20% annually for the next many years as the investment universe expands in the country, Sebi chairman Tuhin Kanta Pandey has said, who also ruled out reports that a regulatory panel is looking at self-listing of stock exchanges which if approved will help NSE that went public last week to trade on its own platform.
Addressing the Association of Portfolio Managers of India (APMI) here Wednesday, Pandey also said the PMS industry should to establish where it fits within an increasingly diverse investment landscape, rather than competing directly with every other investment product.
“Most of the components of the investing universe have been talking about more than a 15% annual growth. In fact, PMS can grow more than 20% per annum,” Pandey said without offering a time-line for such a faster clip.“Let's not discount the fact that investors have other avenues. They have MFs and AIFs. These are components that are meeting different kind of clientele. They don't necessarily compete with each other,” he said asking the industry to not to get into direct competition with every other investment product.
Because, PMS, he said, caters to a niche clientele including high-net-worth individuals, while passive products can appeal to investors who place greater emphasis on cost.“Your industry has to find that niche and communicate it well. You'll have to build that trust,” Pandey said.
Meanwhile, he scotched reports in a section of the media that Sebi is mulling to set up a panel to consider if self-trading by stock exchanges can be allowed or not, saying "bourses must satisfy themselves on details put by listed companies."In the run-up to its IPO which it completed last week, NSE has been floating the idea that it would love to have self-listing. The NSE chairman even went a step ahead demanding Sebi allow self-listing.
“The markets regulator should reconsider allowing exchanges to list on their own platforms,” NSE chairman Srinivas Injeti had last on Friday, a day after the bourse operator debuted on the rival BSE.
At 1300 hrs Wednesday, NSE was trading flat on the BSE at Rs 1,767, down from its issue price of Rs 1,785, while the BSE was trading at Rs 3,120, down 2.5% on the NSE. Sebi had debated allowing self-listing in 2015 but rejected the idea over potential conflicts of interest, requiring their shares to trade on rival bourses. However, self-listing is permitted in several major global markets.
In the US, for example, the New York Stock Exchange's parent Intercontinental Exchange is listed and traded on the NYSE, which it operates.NSE accounts for about 93% of the cash-market trading and nearly 75% of options.Earlier some media reports had suggested that the NSE could trade on its own exchange via the "permitted to trade" category after listing on the BSE.