Synopsis : SBI Funds Management's upcoming IPO is entirely an Offer for Sale (OFS), allowing promoters SBI and Amundi to monetise part of their holdings while retaining long-term control. Here's what changes—and what doesn't—for investors.
The upcoming IPO of SBI Funds Management, the asset manager behind SBI Mutual Fund, has attracted significant attention, not only because of its size but also because both promoters—State Bank of India (SBI) and Amundi India Holding—are selling shares.
While this may appear to be an exit by the promoters, the Draft Red Herring Prospectus (DRHP) makes it clear that both will continue as long-term strategic shareholders after the listing.
Here's what investors need to know.
A pure Offer for Sale (OFS)
One of the biggest highlights of the IPO is that it is entirely an Offer for Sale (OFS).
This means the company is not issuing any fresh shares and will not receive any funds from the public issue. Instead, the entire proceeds will go to the existing shareholders who are selling a portion of their stake.
According to the DRHP, the IPO consists of up to 203.7 million equity shares offered by the two promoters.
Who is selling what?
SBI will remain the larger seller in the transaction.
- State Bank of India will sell up to 128.33 million shares, representing nearly 63% of the total offer.
- Amundi India Holding will sell up to 75.37 million shares, accounting for the remaining 37%.
The final issue size in rupee terms will be determined once the company announces the IPO price band.
Are the promoters exiting?
The answer is no.
Before the IPO, SBI owns 61.76% of SBI Funds Management, while Amundi India Holding owns 36.26%.
Under an Inter-se Agreement disclosed in the DRHP, both promoters have committed to maintaining significant ownership even after the IPO.
- SBI will continue to hold at least 52% of the company.
- Amundi has agreed not to reduce its stake below 23%.
This ensures that both promoters remain controlling shareholders after listing.
Strategic partnership remains unchanged
The relationship between SBI and Amundi is also expected to continue for the long term.
Both companies signed a Commercial Agreement on March 19, 2026, under which they will continue working together as preferred partners for investment management and distribution.
This indicates that while both shareholders are unlocking part of their investment, the underlying business partnership remains intact.
Promoters are unlocking value
The IPO also allows both promoters to realise substantial gains on their long-term investment.
According to the DRHP:
- SBI's weighted average acquisition cost for the shares being sold is ₹0.15 per share.
- Amundi's weighted average acquisition cost is ₹4.35 per share.
The final value realised by both shareholders will depend on the IPO pricing.
What should investors watch?
SBI Funds Management is currently India's largest asset management company by quarterly average mutual fund assets under management, with a 15.4% market share as of December 31, 2025.
The company will list on both the BSE and the NSE.
As per SEBI regulations, the IPO allocation will include:
- Up to 50% reserved for Qualified Institutional Buyers (QIBs)
- At least 15% for Non-Institutional Investors (NIIs)
- At least 35% for Retail Individual Investors (RIIs)
For investors, the key takeaway is that this IPO represents partial monetisation by the promoters rather than an exit, with both SBI and Amundi continuing to retain significant ownership and long-term strategic involvement.
Disclaimer : This article is intended for informational and educational purposes only and should not be construed as investment advice or a recommendation to subscribe to any IPO. IPO investments are subject to market risks, and investors should carefully read the Red Herring Prospectus (RHP) and consult a SEBI-registered financial advisor before making any investment decision.
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