CRAMC

Adds background, details and notes throughout

Oct 29 (Reuters) - Shares of Indian asset managers fell as much as 8% on Wednesday, with analysts warning of a potential hit to profitability after the markets regulator proposed lowering the cap on brokerage fees, among other changes, seeking transparency in costs.

Motilal Oswal Financial Services MOFS.NS led losses among pack with a 8% decline. Nippon Asset Management NIPF.NS, dropped 6%.

Aditya Birla Sun Life AMC ADIE.NS and HDFC Asset Management Company HDFA.NS fell 5% and 4%, respectively.

Analysts at Jefferies said that the move could bring down profit before tax by about 30-33% for HFDC AMC and Nippon AMC in 2027.

The Securities and Exchange Board of India (SEBI) has proposed sharply lowering the cap on brokerage fees to 2 basis points from 12 bps for cash market transactions and to 1 bp from 5 bps for derivatives.

Typically, the brokerage's expenses, including fees and transaction costs, among others, are deducted from the fund's net asset value (NAV) and is referred to as the expense ratio. A reduction in fees will mean less money deducted under the expense ratio umbrella, freeing up assets for the investor.

A significant reduction in fees is likely to hit brokerages' revenue, ICICI Direct said in a note.

Jefferies added that these rules could also hurt institutional brokers such 360 One Wam ONEW.NS and Nuvama NUVA.NS, which are down about 4.3% and 2.9%, respectively.

Among banks, Kotak Mahindra KTKM.NS could be hit due to higher brokerage-linked revenue, Jefferies said.

(Reporting by Urvi Dugar in Bengaluru; Editing by Janane Venkatraman)

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Updates stock price in paragraph 2, adds details throughout

By Vivek Kumar M

Oct 17 (Reuters) - India's Canara HSBC Life Insurance CANR.NS made a muted debut on the bourses on Friday, as unappealing pricing and a crowded IPO market clouded the insurer's prospects.

Its stock was trading at 108.9 rupees, as of 10:50 a.m. IST, up 2.7% from its issue and listing price of 106 rupees, yielding the insurer a valuation of 105.15 billion rupees ($1.20 billion).

Peers SBI Life Insurance SBIL.NS and HDFC Life Insurance HDFL.NS are valued around $21 billion and $18 billion, respectively.

Canara HSBC Life Insurance, which is a joint venture between Canara Bank and HSBC Insurance (Asia-Pacific) Holdings, struggled to garner bids from retail and non-institutional investors earlier this week.

Retail investors subscribed 42% of their quota, while high-net-worth individuals subscribed a third of their shares in the $283 million IPO.

Thanks to qualified institutional buyers, the issue was subscribed 2.29 times, which was still lower than most other IPOs that opened in the last couple of weeks.

For instance, another Canara Bank-promoted entity, Canara Robeco Asset Management CANE.NS, received bids worth nearly 10-fold and closed 13% higher in its debut on Thursday.

Choice Broking said the insurer's valuation appeared to be fully priced, with price-to-enterprise value multiple, a stock valuation metric, of 1.6x, while industry averaged 2.4x.

"High dependence on bancassurance (where banks sell insurance) and relatively lower VNB (value of new business) margins compared to peers is expected to keep valuation multiples at a discount to peers," ICICI Direct said.

The insurer got 87% of its new business premium in fiscal year 2024-25 through bancassurance, with Canara Bank contributing 70.6% of this.

The listing caps a busy week for the Indian IPO market, which saw five stock debuts, including a blockbuster listing from LG Electronics India LGEL.NS and a muted start from the country's largest IPO of the year, Tata Capital TATC.NS. ($1 = 87.8387 Indian rupees)

(Reporting by Vivek Kumar M; Editing by Sumana Nandy and Harikrishnan Nair)

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Oct 16 (Reuters) - Indian asset manager Canara Robeco's CANE.NS shares listed at a premium of 5.4% to their issue price in their pre-open trading debut on the National Stock Exchange on Thursday.

The Mumbai-based firm's stock opened at 280.25 rupees, above the 266 rupee issue price.

Its IPO was subscribed nearly 10-fold earlier this week, led by a heavy demand from qualified institutional buyers, who subscribed 26-fold their reserved quota. In comparison, retail investors' portion was subscribed two-fold.

Canara Robeco Asset Management is the first public debut by an Indian asset manager this year, adding to the growing list of financial services firms tapping the capital markets. ICICI Prudential AMC IICL.NS is expected to list soon.

(Reporting by Yagnoseni Das in Bengaluru; Editing by Harikrishnan Nair)

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