Reliance Capital, India’s biggest money manager, expects to attract up to $2bn for its mutual funds from the six Gulf Arab countries as investors seek to benefit from growth in Asia’s third-biggest economy.
“There is a huge potential in wealth management because of the high net worth individuals here,” chief executive officer Sam Ghosh told a news conference in Dubai. “We want to grow our book to $1bn in the next two years and to $2bn in the next five years” from $40m now, he said.
The six GCC countries – Saudi Arabia, the UAE, Qatar, Kuwait, Oman and Bahrain – pump more than 16 percent of the world’s crude oil and a quadrupling of oil prices in the past eight years is helping boost government investment and economic growth across the region.
Rich individuals in the Middle East held about $1.5 trillion in wealth in 2009, according to research by Capgemini and Bank of America Corp’s Merrill Lynch unit.
Reliance Capital managed 1.4 trillion rupees ($32bn) across mutual funds, pension funds, managed accounts and hedge funds at the end of December. Its Reliance Mutual Fund is India’s biggest, with market share of more than 15 percent.
Its Reliance Asset Management (UK) Plc unit set up an office at the Dubai International Financial Center last year and offers investment advisory services to individuals and institutions, according to a company statement. Its asset management unit in Malaysia also offers Sharia-compliant funds.
Reliance plans to target the large number of non-resident Indians living in the Gulf Arab countries as well as wealthy family offices and financial institutions, Ghosh said. About 80 percent of the investments by these individuals and institutions are expected to be made in listed equities and the rest in other assets like private equity investments, he said.
India’s economic growth may accelerate to as much as 9.3 percent in the next financial year beginning April 1, the fastest pace since 2008, the annual Economic Survey said February 25. The country is the world’s fastest growing major economy after China.
Reliance is also helping mid-size Indian businesses target business opportunities in the GCC, Ghosh said. The company may consider setting up an asset management company in Dubai, he said.
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