The Bajaj group is all set to step into the mutual fund arena.

The Securities and the Exchange Board of India (Sebi) has given its in-principle approval to Bajaj Finserv to sponsor a mutual fund, the company said on Tuesday. Bajaj Finserv said it would also setup an Asset Management Company (AMC).

“Accordingly, the company would be setting up an asset management company (AMC) and the trustee company, directly or indirectly i.e., itself or through its subsidiary in accordance with applicable Sebi regulations and other applicable laws,” Bajaj Finserv said in an exchange filing.

The shares of Bajaj Finserv jumped 7.91 per cent on the Bombay Stock Exchange following the announcement.

Bajaj Finserv is the holding company for the businesses dealing with financial services of the Bajaj group. Its business verticals include NBFC Bajaj Finance, Bajaj Allianz General Insurance, Bajaj Allianz Life Insurance.

Other businesses include health tech platform Bajaj Finserv Health, digital marketplace Bajaj Finserv Direct and digital stockbroker Bajaj Financial Securities Limited .

The expansion comes at a time the Indian mutual fund industry, comprising 44 companies, breached the Rs 35 lakh crore landmark for net assets under management for the first time ever in July 2021.

According to industry body Association of Mutual Funds in India, retail investors held 8.72 crore accounts (folios) with the mutual funds at the end of July, which are an all-time high with 55 lakh folios added from April.

By contrast, there were just 18 lakh new folios in the whole of the last fiscal.

The trend projects an affinity towards mutual funds as an asset class for retail investors. Analysts said the Bajaj group’s foray into the rapidly growing industry will complement its other businesses in insurance and lending.

For the quarter ending June 2021, Bajaj Finserv reported an over 31 per cent decline in consolidated net profit at Rs 833 crore. The company had reported a net profit of Rs 1,215 crore in the same quarter of the preceding fiscal. The consolidated total income also plunged to Rs 13,949 crore in the first quarter against Rs 14,192 crore in the year-ago quarter.

On July 21, 2021, the board of directors of Bajaj Finserv had approved a Rs 342-crore investment by the company in Bajaj Finserv Direct (BFDL), a wholly owned subsidiary . BFDL is primarily engaged in the business of distribution of financial products through the digital marketplace.

Stocks break records

Equity benchmarks darted up to fresh lifetime highs on Tuesday, propelled by heavy buying in banking, finance and metal stocks amid supportive global cues.

Rising for the second straight session, the 30-share BSE Sensex soared 403.19 points or 0.73 per cent to end at its lifetime peak of 55958.98. On similar lines, the broader NSE Nifty surged 128.15 points or 0.78 per cent to its all-time closing high of 16624.60.

Bajaj Finserv was the star performer in the Sensex pack.

Equity investors became richer by more than Rs 2.79 lakh crore . The market capitalisation of BSE-listed companies jumped to Rs 2,40,47,079.99 crore.