L&T Finance may buy stake in mutual fund business

L&T Finance, the wholly-owned subsidiary of engineering and construction major Larsen & Toubro, today said that it is keen to get into the mutual funds business, and is open to acquisitions to become an asset management company.

"Mutual funds are an area of interest for us. There are options for both organic and inorganic routes for that. We will look them and evaluate them," N Sivaraman executive vice-president of the non-banking finance company, told a press conference in Mumbai today.

The company has not yet sought permission from the Securities and Exchange Board of India, but "we are looking at entering the mutual fund business mainly through the organic route but we might also look at acquisitions as well", Sivaraman said.

He added that there were enough mutual fund players to talk to who are particularly available for purchase. "Once we zero in on a worthy candidate we will apply for regulatory approval to start our AMC business," he said.

The comments assume significance in the light of reports that L&T Finance is looking at acquiring the AMC, Cholamandalam DBS. (See: L&T Finance in race for Cholomandalam DBS: reports) However, Sivaraman remained non-committal to a direct question about this. "We don't want to comment on any particular company," he said.

R Shankar Raman, executive vice-president (finance), added that the company is looking for a relatively small, tidy and manageable AMC. "There are many AMCs looking at consolidating now", he added.