Do what you are good at and not to diversify in unrelated areas 🙂 The Telecom Czar Sunil Bharti Mittal is now tasting Failure in Mutual Fund Business.
Bharti Enterprises is planning to end its mutual fund joint venture business in India with France-based AXA. In the mutual fund JV Bharti holds 25% stake through Bharti Ventures and the rest 75% is been held by AXA Investment Managers Asia Holdings. The asset management company got approval from SEBI in March 2008 and commenced its operation in July. As on February 2009 the asset under management stands at meager Rs.186 crore.
Bharti is planning to dilute its stake in its MF JV. This move comes due to the inability of its MF business to capture market presence, weak distribution network and exit of some senior level executives three months back. This plan of Bharti will not effect on its insurance JV with AXA.
Due to sharp decline in stock market, mutual fund industry has come under pressure. In 2008 Punjab National Bank had planned for a similar move i.e. ending its MF venture with Principal Financial Group.