Is SBI Planning to Divest 6.3% Stake in SBI Funds Management Limited via IPO?
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Synopsis
The State Bank of India (SBI) is set to divest a significant stake in SBI Funds Management Limited through an upcoming IPO. This strategic move aims to enhance market participation and maximize value for stakeholders. Discover the implications of this decision and how it positions SBI in the competitive asset management landscape.
Key Takeaways
- SBI is divesting 6.3% stake in SBIFML.
- Amundi will divest 3.7% stake.
- This IPO aims to maximize value for stakeholders.
- It will enhance market participation and product awareness.
- SBI's net profit saw a 6.4% YoY increase.
New Delhi, Nov 6 (NationPress) The State Bank of India (SBI) declared on Thursday its intention to divest 3,20,60,000 equity shares, representing 6.3007% of the total equity capital of SBI Funds Management Limited (SBIFML), through an initial public offering (IPO).
Furthermore, Amundi India Holding, another promoter of SBIFML, plans to divest 1,88,30,000 equity shares, which is equivalent to 3.7006% of the total equity capital of SBIFML. This results in a combined stake of 10.0013% comprising 5,08,90,000 shares that will be listed, as per its stock exchange filing.
According to SBI Chairman Challa Sreenivasulu Setty, “SBI Funds Management Limited (SBIFML) will become the third subsidiary of SBI to be publicly listed, following SBI Cards and SBI Life Insurance. Given SBIFML's strong performance and market leadership over the years, now is the perfect time to initiate the IPO process.”
He added that the IPO aims to optimize value for current stakeholders, create opportunities for general shareholders, and enhance product awareness among a broader audience of potential investors.
Both promoters of SBIFML have come together to initiate this IPO, expected to be finalized in 2026, as stated by India’s largest public sector lender.
Valerie Baudson, the Chief Executive Officer of Amundi, commented, “Over the years, SBI Funds Management Limited has established itself as a leader in India’s asset management sector. It has successfully leveraged the robust distribution network of SBI in India, combined with Amundi’s global asset management expertise.”
Earlier, SBI reported a 6.4% year-on-year (YoY) increase in its consolidated net profit, reaching Rs 21,504.49 crore for the second quarter (Q2) of FY26, compared to Rs 20,219.62 crore in the same quarter of the previous financial year (Q2 FY25).
The bank's net interest income (NII) rose by 3.28% year-over-year to Rs 42,984 crore from Rs 41,620 crore during the same quarter last year.
As per its previous regulatory filing, its domestic net interest margin (NIM) has decreased to 3.09%, which is 18 basis points lower than the 3.27% reported a year ago.
Point of View
I believe that SBI's decision to divest a portion of its stake in SBI Funds Management Limited reflects a strategic move aimed at maximizing stakeholder value while opening avenues for broader market participation. This initiative not only showcases SBI's commitment to transparency but also enhances the investment landscape in India's asset management sector.
NationPress
06/11/2025
Frequently Asked Questions
What percentage of SBI Funds Management Limited is SBI divesting?
SBI is divesting 6.3% of its total equity capital in SBI Funds Management Limited through the IPO.
When is the IPO expected to be completed?
The IPO is expected to be finalized in 2026.
What is the total number of shares being listed?
A total of 5,08,90,000 shares will be listed as part of the IPO.
Who is the other promoter of SBI Funds Management Limited?
Amundi India Holding is the other promoter of SBI Funds Management Limited.
What has been the recent performance of SBI?
SBI reported a 6.4% year-on-year increase in its consolidated net profit for Q2 of FY26.
