Navi MF set to bring Vanguard Funds to India


Navi Mutual Fund has filed for 10 new funds with SEBI.

All the funds are passively managed funds. Such funds mimic the performance of an underlying index. So, there is no fund manager taking active investment decisions.

The funds so far filed by Navi MF are Navi Nifty Next 50 Fund, Nifty Midcap 150 Index Fund, Nifty Smallcap Index 250 Fund, Navi NASDAQ 100 Fund of Fund, Navi Total US Stock Market Fund of Fund, Navi Nifty 100 ESG Index Fund, Navi Nifty Bank Index Fund, Navi Nifty Commodities Index Fund, Navi Nifty IT Index Fund and Navi Nifty Pharma Index Fund.

With the Navi Total US Stock Market FoF, Indian investors will get exposure to a Vanguard fund — the Vanguard Total Stock Market Index Fund ETF. Vanguard is the second largest asset manager in the world and pioneer in passive investing.

Navi MF will be able to launch NFOs of these funds once SEBI gives its approval.

Navi MF is part of Sachin Bansal’s ambitions of building a huge financial services platform, after he exited Flipkart. In February 2021, Navi acquired Essel MF and launched its own fund house.

In July 2021, Navi MF had launched Navi Nifty 50 Index Fund, which became the cheapest index fund in the mutual fund industry.

Apart from Navi MF, several new fund houses are likely to get launched soon. Several firms are either waiting for SEBI approval or are at advanced stages of getting the green light from SEBI. Recently, Bajaj Finserv got in-principle approval from SEBI. In early August, discount broker Samco Securities got the final approval from SEBI to launch its mutual fund business. NJ India, which is the largest MF distributor in India, also received final approval from SEBI to launch its own mutual fund business earlier in the year.

Besides these, PMS firms are also taking interest in MF business. Bengaluru-based Capitalmind Wealth and Chennai-headquartered portfolio management service provider Unifi Capital have also applied for MF licences. Another PMS provider – White Oak Capital Management – acquired YES MF in August 2020. The firm is yet to get the final nod from SEBI to start the MF business. Helios Capital and Alchemy Capital, the PMS firms backed by widely-regarded investors Samir Arora and Rakesh Jhunjhunwala respectively, have also applied for MF license.

The low under-penetration of mutual funds in India compared to other countries has created a lot of interest among financial services firms.


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