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BlackRock has struck a joint venture with the financial services arm of Indian tycoon Mukesh Ambani’s empire to launch a digital-first asset manager aimed at serving India’s growing investor population.
BlackRock, the world’s largest money manager, and Jio Financial Services each plan to invest up to $150mn in the 50-50 venture. The announcement comes less than a week after Jio Financial Services officially demerged from Ambani’s larger Reliance Industries conglomerate, India’s biggest listed company by market share.
While property and jewellery have long been assets of choice for many Indian households, the companies will hope to profit from the growing pool of savers who are including financial products in their retirement plans.
Analysts expect Jio Financial Services to benefit from vast troves of consumer data collected by Ambani’s Jio mobile phone network, India’s largest by subscribers. Jio Financial Services’ shares are expected to start trading sometime in this quarter.
Hitesh Sethia, chief executive of Jio Financial Services, said that the joint venture “will leverage BlackRock’s deep expertise in investment and risk management along with the technology capability and deep market expertise of JFS to drive digital delivery of products”. Sethia previously spent two decades at Indian private sector lender ICICI Bank.
This is BlackRock’s second effort to crack the Indian retail market after it sold out of a joint venture with DSP Group in 2018. The New York-based group already has a substantial presence in India, with 2,400 employees across investing, operations, analytics and corporate functions.
Roughly 15 per cent of $422bn in Asian emerging markets assets managed by BlackRock are in India. The group manages nearly $13bn more in direct Indian exposure for global investors.
“India represents an enormously important opportunity. The convergence of rising affluence, favourable demographics, and digital transformation across industries is reshaping the market in incredible ways,” said Rachel Lord, head of BlackRock’s Asian and Pacific business.
“Jio BlackRock will place the combined strength and scale of both of our companies in the hands of millions of investors in India,” Lord added.