SBI Funds Management IPO plan: How its mutual fund business rose to the top

On 19 March, SBI Funds Management Ltd, the company that runs SBI Mutual Fund, filed papers with the capital markets regulator to offer its shares to the public for the first time. If it follows through with that plan, as expected in the second half of 2026, all the top four mutual funds in India by assets under management (AUM) will be listed on the stock market. SBI Mutual Fund is the largest of the lot, a position it has achieved over the past decade.

While it isn’t a standout in equity performance or maximizing revenues relative to assets managed, it has a lot going for it, starting with its parental connections.SBI Mutual Fund is India’s second-oldest fund house. It was set up in 1987, when the sector was closed to private players. Over the years, it has gone through several phases.

Despite its parent being State Bank of India (SBI), India’s largest bank, it did not leverage that relationship effectively. When the sector was privatized in 1993, attention shifted to foreign fund houses like Franklin Templeton, HDFC Bank and ICICI Bank. In 2015, SBI Mutual Fund was ranked fourth by assets, but trailed HDFC and ICICI by 40-45% in AUMs.That changed in the ensuing decade.

During 2015-2020, its AUMs grew at twice the rate of ICICI and HDFC, and it leapfrogged them, along with Nippon, to secure the top spot. In the next five-year period, it matched their growth and held on to the top slot. In the October to December 2025 quarter, SBI’s average AUMs amounted to ₹12.5 trillion, against ₹10.8 trillion for ICICI and ₹9.2 trillion for HDFC.As of December 2015, five of the top 20 schemes by AUM were from SBI.