AMC stocks surge up to 13% as SEBI defers rationalisaton of TER

Shares of asset management companies (AMCs) surged in the early trade on June 30 after the marker regulator deferred its decision to rationalise the total expense ratio (TER), or the expenses that mutual fund (MF) schemes can charge their investors.

The Securities and Exchange Board of India (SEBI) was expected to redefine TER by bringing many charges within its limits, a proposal that had AMCs concerned.

Analysts had expected a 20-30 percent drop in profits for AMCs if proposals were accepted by SEBI Board which met on June 28.

At around 9.50 am, UTI Asset Management was up nearly 7 percent to Rs 774.95, HDFC Asset Management 10 percent at Rs 2,265, Aditya Birla Sun Life AMC 6 percent at Rs 391 and Nippon Life Asset Management added nearly 13 percent to Rs 283 on BSE.

SEBI chairperson Madhabi Puri Buch said the regulator would soon come up with a second consultation paper on rationalising the TER.